Transcript for:
Butterfly Effect L55: Range Breaking 2

yeah and and this is exactly what it is right like you've got this move which is continuing to hold this you have i don't even know if you have any hard closes underneath it doesn't look like you do you have no hard closes under it so so really that's the key to this piece of the move like here's the hold there's there's no hard closes under it right there's there's no heart close on this move and you could even move that to here right now so where you where you could stop actually let's do this you could stop underneath that level but again i wouldn't be getting out of this particular trade when i'm looking at this range unless we hard close this level because this is what's holding the entirety of the move up right so you don't like you don't have that now let's make it uh solid and yeah uh let's go purple pink yeah okay that's good like you don't you don't have any hard clothes under this so so really if you're going to lock up profits it should be when you hard close it's because that's right when it's going to dump it's going to bounce off this et cetera but but this is how you're you're dissecting a move right like this is this is the exact thing that you need to do to dissect the move when you have this kind of scaling up and no no uh pieces of that move left you don't have any trends to create so so it's just a matter of continuing holding sideways all these local trends get made right even even here you don't have any hard closes of this trend you don't have any hard closes of your your first hold level there like this is the base of the move this is what it needs to hold right it's you know you've got all these interior trends that you can make and find you kind of right out to here from you know distribution to distribution but but really that the key is like where's the polarity in the move and if we actually take the replayer tool you don't even have polarity until this moment and then i would even go in here and say what's the final hole level like is this tested yeah is this no i guess that's not really tested so like you you hard close over this and the move has gone up your heart closed over this and the move has gone down so that that's kind of where you've defined your move down to like yeah okay you have trends here they're going to break but really again the key is the hard close right so if you hard close under this if your heart closes above that you're going up because you have to find those moments of polarity right yeah no hard closes not on either side yet so there's really nothing to do just stay in this trade it's just continuing to hold its range it's pandora's boxing right like it's it's doing the same thing and it'll eventually break through one of its trends and that trend will fuel it right so there's that trend break and that's nice the the trend is starting to break starting to develop over no hard clothes on either side i would get out of this trade if we hard close this level here no hard clothes yet and that's fine and does it hit our target up top let's just take a look yeah you get out right there i wonder if there's any targets that we missed you know that's the next thing i would say yeah there is actually one right here actually that would have been our next target so so you would have been in the same scenario so let's actually go back to this let's go to the higher time frame yeah that is its own range there you can see that's its own range so we just simply didn't we marked the top of the move we forgot one of the ranges well let's make sure we have the right target here uh that's kind of it's kind of uh not really liking that range let's see let's go do this again 30 minute that's tested 15 is not i don't love it i actually like this a little better let's see if there's anything else here i don't love it three minutes let's check the one minute um tested that's pretty close i'd almost rather see something like this as a target which gives you this right here right where was the level started right there and there's a deeper piece of that so right there like that that's your next target actually you have this right here on the 15. yeah this is the target this is right here yep right there okay so that's fine oh stop stop stop trading view hello oh i didn't hit pause so let's go dissect this piece of the move now and and see the uh the key difference here right like no notice how immediately inside of this move you're already pushing the range up like there's okay so so these two moves this right here this first set of candles right here compared to this first set of candles right here they both reach up to one target and they both create a trend right so this like this creates a trend here and that breaks this to this right here creates this trend let's go where we want one minute perfect let's go one candle at a time and that breaks up but that's good so it has a new trend it makes right so so it's almost the same move right now it's looking like it's going to be the same thing it's going to push the range up and it's going to actually um unbind this to not have any hold levels because right now this is the level right here right right now that's the level okay so we have a trend okay so here's here's your first key difference your trend actually wasn't even developed here because your trend would be like this which isn't a trend you the best thing you can do is mark an interior trend like this which you would also have reset the process like this so this hasn't found the top of its range this has a trend it needs to break right and it now has a hold level that it has to unpolarize off of right hits that hold level hits its trend needs to hard close this level right so this is this is the hold on the other side so so this is your kind of your your big difference in this move is one move unbreaches its range so it has to create its whole level which would be like this okay we have a whole level here so you hard close over that so we can take this out so you hard close over this just like you hard close over this one here and we can take this out too we're we're trying to make these moves as similar as possible this here has a move it needs to hard close without a range create without a trend created yet okay this then also has this base of the move right here okay and this has the base of its move right here because there's nothing left underneath this so if you hard close let's take those two away and uh if you hard close this guy your your move is going to be done right and and so there it is there's the hard close against the trend you haven't made any trend breaks you haven't kind of recaptured the range and you're failing the base of your range so so this thing should just pull back now right because it is hard closing exactly where it's supposed to right so this would be like a trigger point for a short if you got in a short here this is where you would trigger out of the short like there's your target there's where you trigger oppositely this side you don't have that hard close on this trend but the second you have the hard close here like the move is done right and then and then you you can so you can see the difference here because in this you actually don't hard close well first off you don't recreate the top of your range secondly you don't create a new trend so so the first step is always okay let's create that first trend that trend breaks let's see if it hits a hold level or let's see if it captures a new top right so same thing here like let's see if it hits creates a trend and if that breaks let's see if it goes above and creates a new trend which will break up and create a new trend which will break up and eventually unpolarize itself against whatever little stupid hole level is here just like it did against this level here right it just keeps creating these higher and higher trends until it unpolarizes itself and then just takes a straight move up so so that's the first thing right like that's your first kind of giveaway on this move it doesn't actually create a new trend like it does like this is its trend i guess that's the right way to say this wasn't the trend this wasn't the trend it keeps on polarizing its move this was the trend right like that was but you can see where that that's shown to you by the whole level so the first thing is this does create its trend so that's your first giveaway your sec your dead giveaway is that heart closes the base of the move as to where this is the base of the move and it tried to hard close it it couldn't but the second this one hard closes like the move is gone and then you know wherever you end up is fine you're always gonna have this set of targets right you're always gonna have this and then you know even here just before we say the next thing you're you don't even have a trend yet so really what you want to do is you know mark oops yeah but what you do have which is this right and you know so you break this it's your trigger point up right back back to the other side is your trigger point up to move up in the move and start moving up against trend and you know higher time frame and higher and so forth and so forth right like that's your that's your trigger point if you get out of this short if you want to use a trigger point or you use a longer term one like this because you have to go to the highest timeframe you have available ah right there it would have been right here first there and then right there anyways it's not important that's not what we're talking about today it's not important let's get rid of these too cluttered we need that one don't need this one don't need that anymore don't need this yeah i'm sure this one gets moved out this one's not really even important for this either but uh okay let's just adjust it anyways that that's this one here okay that's not important oops no why did i just delete that's not that this one's not important um that this one still is right that is still important that one there oh maybe actually it adapts so right there and then this pulls back down to right here and uh your stop on the move which is your target uh what is this yellow oh this is the local trend okay perfect so so this is where we're at so so you can see the fundamental difference between these two moves as to when one keeps recreating its trend the other loses its whole level because you're going to have a moment of polarity whenever you're moving up like this that's the difference between a move hitting its target and finishing versus creating a range that is constantly developing a base and it's holding its base of its range right like i guess that would be the most important part of this one right here is let's delete this and delete this identifying that polarity because that's the base of the move so so that this was the polarity right here this is the player in the move right here this is the polarity in the move right here right like that that's the whole level there this is the one it has to break over top of this is the whole double here and uh let's make these equalized both gray right so this is hit already it needs to break over top of that so maybe maybe next would be this for a short 97 21 maybe in the future we'll come up to this 9721 and it'll be a really nice short yeah who knows i'm pretty sure we would but anyways we can check that after really the important thing is understanding the polarity on both sides and and when you hard close that defines whether it's going to go up or down and and the trends help you make that decision of what the possible direction could come so like in this scenario here this trend helps you make that decision like you would have had this like this you would have had a trend like this and you would have had your whole level and say okay if we had clothes under this we need to get out of this trade and and that's fine we accept our profits or our targets hit we've hard closed this that's it the move is done rather you you get into the scenario where you're just recreating a new trend so now you're saying oh this until we have another trend to use so okay well what are we supposed to do here okay well we know we just don't get out of this trade until this hard closes is is breached right or or you know alternatively on this side this one would have been here you know so fine you can now have this trend like this right and and you're in the same scenario you're just waiting to see which side is hard closing you're really you're really sitting here and and minute by minute you're just kind of waiting so fine yeah okay okay there's the break of the trend so you should probably move up pretty soon here and there it is right there so you actually can just make a new trend micro cycle the trend right okay now we have this here we don't really have anything else yet so so really we're just trying to at this point kind of hold this level but not hard close the base i mean that would be kind of the information we use here okay so we hold that level it's fine it's fine if it doesn't you know if it hard closes like not a huge deal then we'd have something like this did this maybe we don't even really have a cycle yet but anyways this is just another point that could stabilize the move right hasn't hard closed yet great we're going to create our next move up here that's perfect so so now we have our trend that's going to break against this whole level so now we have like the clarity on both sides of this move and we're still in this trade because we haven't been given a reason to exit the trade yet like the difference between 93 and yeah it's actually a big difference in price 30 but but again it's fine where are you getting out of this trade right if your target was hit if that's all you expected that trade take the trade target like i think that memory serves me somewhere around here where's our target 96.75 something like that and this trade is still it's it's still just at the base of its range it's it's you know not hard closing anything yet you know and even even right now it's it's got this right here that it needs to get over top of which is you know in other moments it's just just you know another moment it has to hard close to gap up right it's important in the trade and then and then you'd be on a higher time frame here so we can actually even go to like a higher time frame candle and say well we don't want this one that's not really that important it's fine we can maybe use it but maybe is there a 15 minute here or no no training view come on now and there actually is a 15 minutes in this moment so you'd have okay it's the same candle and uh you know you you have this here so you know you have your next trend that you can break and possibly try to unpolarize this move right your next uh short should exist somewhere you know and then and then so so you're here and and again now like what do you have for trend you don't you don't have a trend there are no trends left right so you know this is gone obviously you're just simply looking to hard close this guy here right like you don't you don't you don't have anything left there is no trend so you don't even need to break trend anymore you just you just need to kind of hard close over top of this level and like i guess you could go like this well not i guess this is what you do you could go like this and say okay well this can fuel the next piece of the move right like maybe this is a three minute yeah that's a three minute so so from there there so so that i would just attach to the one minute candle like this and so so you can break this to uh fuel the next piece of this move and that's exactly what happens right so you know you've unpolarized the move you've hard closed the move right to your next trend so what is this like a one minute move fifty percent yeah and and you just gap straight up to your next target and then the same cycle recreates up here right like so so you're in this move and you're saying okay where's the base of my move you don't really have anything yet okay you kind of have a base now okay perfect we at least we have this here so at least there's this here so so now we just simply need to see okay we have a trend which is this blue candle here we have the base of a move like we have something to at least base this off of okay now we actually have a bit of a better trend maybe as it's like a three minute yeah okay fine so you have like this right here on the three it's rearranges to the one and that's the uh the same thing okay we have the base of a move here um we haven't had closed anything yet so we actually have a trend that we need to break now so so we have a trend right we we have our trend that we need to break so we actually do have a trend now so if we can continue to hold this move we can we can we can move up and we actually create our first hold here which is which is nice because so so we actually created like the first hole so this you can't lose this once you lose this the move is gone right you either break trend and start to create polarity up top or you lose this on hard close and move is done so even here you know you'd be like this in this piece of the moment here and it's right here so like at least you have something at least you have a whole level that can break up top with a trend right so you have something but then you hard close your mood and and this is over like you're done this is it you needed to hold this level through this trend at least in order to make some kind of either new trends to start attacking the cycle upwards like you can see the fundamental difference as to where this creates higher moves that create more new trends and this is just continuously holding its trend not only does it hold this trend it creates polarity and hard closes polarity so like this move is done that that's the difference between these two this never hard closes polarity and it's constantly creating new levels right and then this thing just falls off a cliff right now this thing just falls off a cliff because there was polarity was already created and you know lost the move it's the difference between you know a target being hit and never breaking over that whole level versus a target being hit and creating new hold levels and new hold levels and you know new cycles in the move and you know just constantly holding the base of the move like i'm sure if this heart closed it'd be a different story but it didn't so this is the way we look at trades when we're in target so when we actually go back to our original spot where we entered this trade which was you know we entered it back here let's move this here we entered this trade right here when we originally entered this trade we were able to kind of constantly make a decision of our target is hit right or we stop out somewhere in this trade and and once we get to a certain point like here here's where we would have stopped out and there was no reason to stop also so now it's a matter of like even even here you can have your trend like this to this so you could have stopped out there if you want again not what you're looking for in the trade you're you're looking for your target to be hit right so if you start moving up you can have a trend like this and if this trend breaks you can get out of the trade i don't really think it's advisable but yeah okay fine right there and it gets to this trend right here like it's just trend polarity too right like in the moment the trends are just polarizing against each other again we're not setting stops against trend though because you can't you can't really do that you're basically saying oh where is the hold level in the move which which is you know right here and that's your target for your next trade anyway so you you either hit your target and a target is always hit right like that that's that's kind of key like a target has always hit and if and if you for some reason miss your target you can use your trend like let's even go to the hourly here and and the hourly was developed right here so so if you're if you for some reason let's pretend this isn't here and let's say this isn't here and this isn't here and this is in here and this isn't here and you're saying oh we want we need to break this trend fine we don't even care about that trend really that's not there and this isn't here and this isn't here in that moment and and and you thought you like when i first started this video i simply just didn't mark this one because i just didn't see the range like maybe i missed that and i thought this was the actual target up here 98 9815 and i'm sure that is a target in the future right that's that's fine i'm sure it is a target but if i was in this trade right even i would go the highest time frames and i would start to at least create something that would show me okay if i hard close this right i'm actually out of the move so i would want to hard close this on the hourly so i would go and i would justify this on a different time frame right i would say okay here's 15 to the 15 right here if i hard close this i'm out right so so then you've got your trend right there and i would actually move this to here right and uh so that's that that's this and if you you hard close this trend you you'd be out of the trade probably fall through it pretty quick and like i'm pretty sure that's actually why this happens right and you fall through it so fast so what would you have actually made if you missed your target so we got in at 58 i believe it was and we would have stopped out here 0.85 really not great right like it's always better to hit a target i suppose what you could do is you could use a trigger here like you could go to [Music] this point here and you could go to come on this right here and when you hard close that you could also be out like you can continuously raise your stop loss and you can continuously raise your trigger points to get you out of that trade for more profits but but really like obviously your target is best because a target is hit or a trigger is released so typically when a trigger and a trade is released you've missed something even you could go to a higher time frame here and say okay well here's the base of the hourly and that's the next candle so we can't use that what about the 30 minute yeah i can't use that 15. yeah you could use this right here like this you could you could use the hourly to the 15 like that and when you lose that you could get out of the trade so you could be out right here but i mean again trends are meant to fuel moves so what's going to happen when you miss your target and your trend breaks well guess what right your your information was here the base of the move being right here and losing that move right like losing losing that whole level that's your that's your polarity that's that's that is what should be where you release your trade like trend is fine to release trade on trend if you don't know what's going on we use trend as something that can you know it's a great trigger point but like i always say either your target is hit or your trigger is released so your trigger being your trend so either either one of two things happen and in our case here we just simply didn't mark up the range where are we yeah we just simply didn't mark out this range from the uh start of the video which is our own fault so that's like a common occurrence so you missed something and and yeah sure one of your triggers is going to get hit i think at that point if my trigger got hit i'd probably just stay in this trade to be honest i actually missed this big move here and i was down here looking at this whole level saying where should i stop out i would probably just leave it here and let and let it break the trend up at least i got a second exit there and at that point there's not it's not you know if i had missed this trade because i i missed my targets here like if i if i was in this trade i would probably leave my stop right here on the final level just just let it keep going because how do you stop out where you're supposed to rebuy like if this is your rebuy area here whatever this is holding if that's your rebuy how how do you stop out there like that that's pretty tough to do but anyways this this is more about understanding the top of a move and how you see a range continuing versus a target being hit that's actually pulling back so when a target is hit you can see it it has a moment of polarity on either side and it hard closes that moment to clarity and you should be out of the trade straight and simple if you constantly break trends and hold the base of your range on the base of your range is your polarity moment if you constantly hold the base of your range just just like in first segment that we looked at you hold the base of the range you continue to break trends and you start to unpolarize up top guess what you're just gapping to the next range if you hit your target pull back create polarity follow your trend guess what your target was hit you're moving down