today i'm going to do a presentation about bnf trading strategy bnf is a famous japanese trader his real name is takashi kotegawa and we're going to talk about this strategy this presentation gonna be a little bit long maybe 20 minutes so if you are not patient and or you don't have time it's battery back on the other day if you don't know about takashi okagawa the previous video i did about this live and here we just gonna talk about this strategy but basically this guy transformed fifteen thousand dollars in over three hundred thousand dollars trading stocks in the japanese stock market first of all i would like to say that uh all information that i get here is from a other channel that is a channel in portuguese language called japaneco you can search for him on youtube japan rico and hong kong but this channel is totally in portuguese language so if you don't understand portuguese you're going to have hard time to get the information this person is uh he speaks portuguese but he also speaks to japanese so he was able to translate the posts that bnf did on social networks and get the information about this strategy so all the credits go to this guy here so if you like to visit this channel go ahead but takashi believes that is easier to do counter trends rights even if looks more risky for most people we need to remember that most people lose money so maybe he's actually right in this presentation i'm gonna show you arguments to justify why is actually safer to counter trend if you do the right things don't jump on the shards and start to do counter attention before you listen to strategy until the end i'm going to explain how the strategy work and why it work and how you can understand the market this is a day trade strategy so the trading period of each trade is going to be maximum two or three days open as you can see some of the trades bnf used to do was one night in two days so if you open the trade on monday morning and you close the trade on tuesday it's one night in two days sometimes you trade also two nights in three days if you open the trade on monday and you close the trade on wednesdays it's two nights and three days i have a mistake here takashi also never let these trades run more than that because the strategy was based on counter dreams so was really risky to keep the position open for a long time one smart thing that takashi did was to identify six different types of traders i'm gonna show you here how he was able to divide the traders and for the actions they do and how you can act like the best trader of these six types here is an example of a chart and i'm gonna show you here this is a normal shoppie chart as you can see the price goes up and down and there are traders that open the position here the long position this thread is going to be traders that they are long-term investors so the reason they open the trade here is not because they saw some information to open the trade but it's because they want to go long on the long term there are also traders type b these are traders that understand that the movement starts up and they bought on the retracement the next day there are traders type c and type d these traders already have seen that the price is going on in one direction and they believe the price should keep going on the same direction that day so they decide to buy here or they decide to buy on the retracement and usually this guy is going to be fine and then there are traders that just buy in the end of the day 2 and these guys usually buy on the top and they're going to be in trouble as you can see here usually these guys gonna get feed by the hoarders of these guys because these guys are not long-term investors so they're gonna close the trade really fast and they actually gonna make money and these guys are gonna buy their positions when they sell here when the c sell gonna feed these guys in the one the div sell gonna feed these guys and this guy's gonna be in trouble because eventually the price gonna retrace the type of traders that gonna make more money are the type a and type b and as you can imagine it's really hard to be the type a because you have no idea that the price go up but actually there is a way to be the type a let's think about this way if you counter trend here since you cannot guess when the price go up maybe there is a way to guess when the price go down so actually you can be a type a trader if you short here in this area maybe you can short until here or maybe even more and you gonna be able to make profit as the type a of type b and if you follow this strategy you're gonna see that is actually really safe as you can see here this is you and you're gonna short this the rocket is up but you go down and in this presentation i'm gonna talk about now the strategy and how you can understand when it's good to counter trend and when you should exit and how you can become a trader type a without risks or with a little bit of risks but control risks maybe you think is risky to gold counter trend but in reality if you follow the strategy you will understand that is less risky than follow the trend it feels that you are catching a falling knife but the risk is super calculated and you will be able to do small losses and big wins the strategy base first of all we're gonna use something called kyrie tsu or in english bias ratio this buyer's ratio represents the distance between the price and the moving average other thing you're going to use on this strategy is volume the volume will help us to understand if the trend is about to change or not also to help us to see if the price is overextended we're going to use bullish and bands even if the most of the time the bollinger bands work really bad i'm going to show you how this actually can help you to see if aligns with these two indicators maybe it's good idea to go the last indicator we're gonna use is rsi and rsi we will not use to see the overbought condition or oversold but you want to use it in a smart way to see divergence if you follow these four rules you want to be able to do high probability trades so you want to have really small losses and sometimes small wins and big wins and most of the time you're gonna be right i was searching for an example and why not use tesla tesla was a stock that was trending for mass of 2020 and 21. as you can see i have here an example of free trade trade one what we can see here we can see the kyrie relative index is a indicator that basically show you the distance between the percentage of distance between the moving average and the price if the price is way too far from the moving average usually the price will come back imagine like a rubber band if you stretch it eventually you have to let it go you cannot stretch it forever because it's gonna blow the idea of this strategy is you analyze this market you are tr you are trading for example let's say tesla a good number to feel if is overbought let's say we gonna use maybe 25 so here trade number one the kyrie relative index it's about 30 so when this day close we're going to prepare to go on the short let's check another indication to go on a short previous i previous i is here okay let's go straight line in this case we don't have a big divergency but if you see we have higher levels here or almost the same level and the price is actually going up so it means that if you look here the price is going up but the rsi is not going really up so you can have an idea what's going to happen here the price is about to change so the idea of this strategy is to when you see this carry relative index going up and so high you're gonna short on the next day so you're gonna enter here when the kite is 33 and then you can write the trade until the kyrie goes to zero or near zero this case is here if you see here you could write the trade from here to here and exit i decide to do another example here the price is really overextended as you can see here trade two we see the price as you can see here kyrie is far below 20. so you enter on the next day the price moves a little bit down and we immediately immediately close this is another rule if you short and the next day that price go up or if you go long and the price goes down you immediately assume that you are wrong and you close the trade on the same day you don't wait anymore so you want to do a small loss here trade number three is the next day and remember you just gonna do this one time if you fail one day and the next day the trending keeps going down then you're gonna prepare to go on along you're gonna enter on the white candle here and what you're gonna do enter the day after the tool the kyrie on this level is roughly 30 so we're gonna go for a long and we're gonna write the price until is about two minus six so is this white candle here it don't look like much but actually if you think about it is a little bit and it's kind of safe as you can see here we lost just a little bit of the candle if you look so now i'm going to show you real life examples in this chart and we're gonna go tesla and see tesla during one year well guys we have here the tradingview.com and as you can see i have rsi kyrie relative index is the indicator and i have here bullish on bands we actually can hide the bullet journals it's not important and we also have the volume and i'm going to show you let's go back in time a little bit maybe 2000 i'm gonna zoom in a little bit here look at here for example we're going to look at the price is 20. you can see here the volume so let's go here 20 so what you're going to do you're going to short so we're going to enter the next day the next day we're going to short here price went down a little bit the next day the price went down again and the next day the price went down again and uh as you can see the kyrie now is five you can see here so we went from from 20 to 16 and to [Music] eight and five let's zoom in a little bit because so you would short this stock until here let's try to find another situations where you can take advantage of this as you can see we counter trend the price is going up in the counter trend perfect let me see i have another situation here as you can see the kyrie he's 25 here and then he's 30 okay let's go maybe we're gonna lose the first trade i believe the zoom in is to be okay this is kind of a situation where we actually gonna get the trigger to go on this trade here and the next day we're gonna open the trade here but there is a rule that i don't tell you about that you should always look to the if the price there is a gap maybe you want to wait for this candle to close then because you never know what's going to happen usually the price uh the market gonna try to fill the gap and actually fill it here so you would short here when this candle closed you're gonna enter here and then you're gonna short until here as you can see the kite is six you close here perfect red here you have a situation when you have eight eight is not good eighteen is not good enough you should take a look on the market previous levels to see because what pnf explained is that the kyrie index is different between each stock and each sector some sector some sectors you can use 20 some sectors have more movement you need to use like 30 maybe so always analyze previous data and see and maybe you are thinking oh but i will not have much trades uh i will remind you that bnf used to check 500 stocks per day so maybe every day you're gonna have one trade two trades you just need to wait and we are on the daily chart so you're gonna have opportunities here we already analyzed this situation so we'll go should we go here 30 okay this is 23 and the next day the price open up open here and actually go a little bit down maybe we will lose this one with closer with the smallest another 24 okay here it should be good let's see this is kind of situations that you see you can see that there is a a gap between the open and the close of this candle as you can see so maybe you would not enter here but if you decide to go short here let's see a good way to see where the okay this candle open here i'm not sure if you are familiar with these kind of temp candles but on the left side you can see where the market open and on the right side you can see where the map market closed if you open here you're gonna you're gonna go short a little bit the other day you open on the same spot the kite is still 11 and you close here and the car is still okay the car is still 11. if you let it open maybe you're gonna close with a small profit okay let's try to find another one minus seven the zoom is the way to be okay minus 23 this one the price closed here so we're gonna wait let's change again to the candles price close here we're gonna wait for the next day the next day the price open here we're gonna go for long and we're gonna write the price until minus three i would close it here so we'll go from here to here win for example here this is this is the low previous law here rsi here to here what is this divergence as you can see here this is lower low and this is a lower high so this is a confirmation that you should go long let's search another one okay finish so as you can see we have couple trades here most of them are wins sometimes small wins but if you do this on a couple hundred stocks you're gonna have trades every day let's see here what is this minus ten as you can see here here the kyrie is really small during this area 2017 the kyrie go between minus 10 and plus 10 so what i would do i would adapt the strategy for these levels and i would start to trade these spikes here for example -11 i would go for a long here and look how beautiful this is maybe this one we would lose open on the next day keep it open one day two days kairos minus zero right from here to here let's see another situation always remember you need to adapt your strategy and the kyrie levels but if you do it you're gonna be good the objective of this strategy is to do high probability trades so you're gonna lose some trades you're gonna win most of the time sometimes small wins sometimes big wins but your loss is gonna be really small and most of the time you're gonna win other thing important of this strategy is that you want to be on the opposite side of the market remember that most people lose money so you don't want to be part of the crowd guys if you like this video please don't forget to like and subscribe so i can keep doing more videos and share more strategies with you so now grab this information go to the charts back test it and let's make some money