The Easiest Way To Determine Daily Bias transcript

All right, welcome to another lesson. Today, I want to talk to you about how to really determine the bias on the daily time frame. Now, so far we've gone over a variety of different things. We're now into the fifth module. We've spoken about AMD, we've spoken about order market theory, we've spoken about inefficiencies in price. And whilst we've gone on to some of the advanced movements of the market, we have to bring it back and realize this is simple.

We know the market is going to rebalance into areas of inefficiency and target highs and lows. But we really have to try and understand the bias in which these candles are moving because this is as simple as it gets. Forget everything you have heard in terms of all these different complicated strategies and concepts. Just focus for a second on the movement of a candle. A candle can do one of two things. It can go higher or it can go lower.

It's very simple. There's no in between. The idea is that when we're selling, we want to try and sell as high as we can on the candle. When we are buying, we want to try and buy as low as we can because we want to try and make advantage of the movement inside the candles. To work out the bias, the simple thing to understand every single day as day traders, and if you are a swing trader, this could work on a monthly time frame.

If you're a day trader, it works on a daily time frame. We need to move in direction to what the overall trend is moving. When I look at the Euro USD futures chart here, to me, this looks like it's coming lower. Overall long-term. And I'm basing that around the fact that price action has rebalanced into these areas for a start. It's also moving into areas like this, areas of inefficiency, but also in the main, and this is where educators out there who try and teach you all of these different varieties of strategies and concepts and overcomplicated terminologies will get frustrated with me.

Because it doesn't take a genius to work out this market is just moving lower. If I was to put a gun to your head and I said, "I want you to trade this in a direction." You'd probably go lower rather than higher. Because this is just moving lower. We can simply use our eyes and see this is moving lower. So, the job is very simple. We're only going to look for candles on the daily timeframe that we think are going to move lower.

So, based on that, when I look at the Euro USD chart, I like to look or any chart for that matter of fact, I like to look at the previous six or seven candles. And I like to try and judge which way I think each day is going to go. Because we're This is the thing. We are only moving via the pro- probabilities of the market. We are not doing anything else. Nothing we do has a determination a terminating factored certain outcome.

You could take the best looking trade in the world and it could fail. You could take the worst looking trade in the world, it could win. It's the nature of the beast. So, we need to understand if we're trading and we want the most of the daily volatility, we need to make sure that we're trying to move it in a certain direction. And when I look at Euro, quite honestly at the moment, just looking at this and this is not pre- I've not I've not set the camera um I've not set the replay mode back, sorry.

I've I'm not cherry-picking examples. I'm going to give you the real stuff. At the moment, I don't know if this is going to go lower right now. Because judging on this move here, it's moving lower, great. But like I said, look at the previous candles. We've been bullish on the daily time frame since Thursday 25th. It's now the 7th of July. So, we've had 1 2 3 4 5 6 7 8. On the 8th day, and predominantly price action has been more bullish.

So, in that instance, I'm a little bit more confused because I'm looking at this thinking this could continue higher, retrace back into this area or something. So, the very easy thing to do, and this is where a lot of people would go into this and just try and throw themselves into it. They try to look for a way, they try and guess the direction. You move onto another chart. If I said to you, take a trade on the daily time frame in a direction you think it's going to go in, you've got to have your stop loss above the previous day candle high.

So, if we were going to trade this lower, this is the day candle and we just want to take this lower for a 1:2, that would be your trade. But because we've been very, very bullish in the last couple of days, this is very uncertain on the outcome. I would almost be more inclined to do something like this, take a long position with my cat with my trade like that. But again, this is uncertain because overall this is bearish.

So, what do we do? We move on and we look and we wait. When I look at Euro, to me, even though this price action fundamentally is more bearish, when we look at the previous days, we've had 1 2 3 4 5 6 7 days being bullish. So, in theory, if you ignore this today's candle that's printing, your trade could be stop loss. So, trading at the open of the daily candle, stop loss at the previous day low, target a 1:2. That could be a trade.

Because we're basing the fact that the lot of the previous daily candles have been pretty bullish. But again, we don't know for certain because overall this is quite bearish. So, it's our job to scour through these charts and look for something a little bit more obvious. When I look at Canadian dollar futures, this looks so much easier to understand. Cuz there is no debate in my mind this is bearish. Zero zero debate.

This is bearish. Price action should move lower. Even with this cluster of sideways price action here, this is bearish. And based on the fact that this is bearish, it's making me want to take this lower. So, a good trade here could be something along the lines of taking a candle, tomorrow's candle doing something like that. Because this should just continue lower. Even though we've had this kind of confusing price action here, you You that price action's been respecting this area of imbalance.

More so, more or less, it's still breaking lower. You could have in theory take a trade and have your stop loss here to come lower. But the best candles to do this on or the best trade the best ways to find this is in continuation plays. So, if we were to look at all of these price action candles here, if we were to look at 1 2 3 4 candles, they've all been bearish. And if I took a trade at the open of that candle, my stop loss was here.

I'd be in profit now. We would have been out of this trade at a 1:2. Now, I know that this isn't the way a lot of people want to trade, but I'm going to get you to practice this way first. Because it's going to help you understanding the bias and movement of the market. Again, the Japanese Yen. This looks a little bit more confusing because we've been very bearish since the 12th of June. Bearish, bearish, bearish all the way down.

What I mean by that is price action is just coming lower. We've recently had this up huge up candle. So, we need this to really print a couple more times bearish before I want to take this lower. Moving over to gold. Again, there's no way of determining for definite whether or not the next daily candle or for for a probability, sorry, if the next daily candle is going to print higher or lower. Because overall, the daily time frame has been printing lower, coming lower.

However, with that in mind, we've had 1 2 3, we're on the fourth of the fifth day where it's been pretty bullish. So, maybe the answer is to sit and wait and watch. You want to be involving yourself on a chart like this one where the bias is just too obvious. If you can find a pair which is just predominantly bearish every day or bullish every day or just in a clear continuation. And I said to you, right. You've seen 1 2 3 4 5 Let's just say six candles.

Majority of them are bullish bearish, sorry. If I said your job is to take a trade at the open of the day candle. So this this would be the trade. Based off this candle. Trade entry. Okay, that's your first thing. And you're you're literally trading this. Open of new day candle. This is going to be a way of entering the market. Stop loss would be above previous day high. And you would basically try and target a 1:2 or something like that.

So you trade every day when you have when you've determined we've had four or five bearish days. You'd be trying to do something like this. >> [snorts] >> Now you might be sitting there thinking, yeah, but hang on, that trade's taken like four or five days to play out. It's a trade that's going to make you money though. And if I said do this every day so the next trade will be down here at the open with your stop loss above the previous day high targeting a 1:2.

And then I said do the exact same thing every day whilst you are bearish. And you would soon start to see that actually just by getting the daily bias correct, you would start to make money. Because there's a lot more winning trades here. This one would have lost. So, it's taken 1 2 3 4 5 6 trades, one has lost. But, the next trade will win. The next trade could win. You may lose a handful of these trades just by doing this.

But, you're following the bias. This is why when I say, "Okay, now do the same on Euro." I don't know what was going to happen because basically, this looks more bullish based on 1 2 3 4 5 6 7 8 9 candles. Overall, the trend is very, very bearish. So, what I want to happen is I want this price action to continue lower. I want basically, to be as simple as I can, to have some more bearish candles print. If I got something like this and I had three candles, I would look to trade the next candle and do something like that.

And if the next candle printed lower, we could get in the trade again. That you can make a career doing this. It might sound really strange. It might sound crazy to some. But, you could trade this. Look at the Dow. The Dow Jones. You could trade this every day bullish. Imagine this. Let's just work out you've had 1 2 3 4 maybe a couple of bullish candles. Let's say you've taken a couple of losses in here and it looks a little bit confusing.

Let's say you've lost four trades. But, then you worked out we're actually going higher. So now after this candle you start moving obviously because there's no clear there's no more obvious way to work out or that actually this is going higher and you can make out your losing trades, your losing period in here. But the thing is you have to understand you won't be trading this. You won't be You wouldn't If you see a bearish a bearish a bullish a bearish a bullish a bearish a bearish a bullish, you're not going to trade it.

You only need to take maybe one loss in here and then suddenly you you're not going to do the next one because this has been bearish. You're going to want to wait until a few more bullish candles. So actually you've taken a loss and you've just been sitting on your hands waiting again. That's what you've been doing. You're just sitting on your hands and you're waiting. So based on everything we're seeing now, let's just say the daily candle essentially closes exactly where it is.

A hypothetical situation would be that you very simply just enter at the open and you go for a one to two. The chances are that price is going to retest this candle and it's going to continue higher. This is a way of entering the market. This is the basic I'm going to introduce you to a much more complex not complex but a much more efficient way of entering the market. This is like the basic stage one of entering the market.

Stage one. This is more for practice as well because we're going to wait for manipulation. We're going to We're going to I'm going to introduce you to the four-hour candles and things like that in the next lessons but just for now this is your play. This is what I did. This is the reps that I did. Take You're going to take 20 of these trades. But you need to wait and you need to do it on a daily time frame cuz you're going to get used to trading on the daily bias.

So, your homework is this. Okay, your homework is this. And this is part of your 20 block trade challenge. Okay? Take 20 trades on the daily time frame. Within this, okay, within this, find the bias. So, when I say find the bias, previous four or five candles. Are they moving in the same direction? So, look at this. 1 2 3 4 5 candles. All bullish. If you get a tick next to that, here's what you do. Enter at open of new daily candle.

You're going to do this on a demo account, so don't worry about slippage, about any of this stuff. Stop loss will go above or below previous day high or low. Target 1 to 2 or something like that. 20 trades. Daily time frame only. That's your homework. Do it on a demo account. >> [snorts] >> This is going to help you get used to looking for simplistic pairs. This might take you a little bit of time. But, this is going to make you a trader.

This is what's going to separate you from 98% of people that are out there overcomplicating something that does not need to be complicated. This is how you're going to make money in the market. This is what's going to set you aside from everyone else. I'm going to only it's only going to get more efficient with your entries from here on out. I'm going to show you different ways of entering on a smaller time frame but getting used to understanding daily bias to the point where worst case you could just enter and this is going to be where things change for you.

So, if you're on the program and you're doing this homework take the 20 trades, journal them. I just want to know I don't care what your win rate was. I just want to know what you learned from it. So, just note down at the bottom of it. Okay? Note at the bottom what you have learned. And as you know, the winner of this entire challenge is going to be rewarded. But it's just going to come down to how much work you're actually putting in because I know that if you do this right you will be extremely successful doing this.

This is not getting you just on the daily time frame. This is not getting you to trade on the daily time frame. This is A, getting you to understand the possibilities, helping you learn daily bias without overcomplicating it. And B, getting you to trust the system, putting the reps in cuz that's what's going to make you profitable at the end of the day. You can do this on futures, you can do it on crypto, you can do it on forex.

Again, if you're on forex and I was looking at maybe USDJPY I wouldn't know what to do here because look, the previous daily candles been bullish until we've had this huge bearish price action. We've only had two bullish candles. I'm I'm moving away from that one. USDCAD is a little bit better, even though we've been kind of stuttering. We've had three bullish candles in an overall bullish trend. So, if this candle closes bullish my trade would be entering at the open of the new candle, stop loss below the low.

I'll be targeting a one to two. This can pass you trading challenges, by the way. This can genuinely pass you challenges. So, that's the homework. If you have any questions, give me a shout. Otherwise, I will speak to you on the next one.