Transcript for:
Butterfly Effect L60: Deep Diving Q&A 1

i had a question on um the way that so for [Music] deep diving a level your entry always has to be a knife catch right because it can't be where it kind of slowly goes down towards your entry point when you deep dive a level since it has to spike down quickly and then come back up without hard closing yeah uh the point where you marked um i guess for example when you're so when you mark a deep dive level you're kind of deciding okay this is the level that i want to hold but i think it go down further so if you for example you wanted to deep dive 90 35 but you decided to um put your entry lower your entry like as the move goes down towards your entry below that level it has to be kind of that like quick wick down and then immediately up it can't be like for example two candles or three candles as like makes its way down to your entry point where it could hard close let's say on the one minute but then like on the three or the five minute is just one candle that's like not hard closing your level i'm just asking if when you okay so for example your hard clothes always have to be against your the level that you choose not your hard not your deep dive point correct correct that has to be against the level that yeah okay so it has to be against the level that you choose um [Music] i guess the next part of that before my original question is then do you um put your hard closes against your level i know at one point in your video you mentioned because for example the three minute level or five minute level you're taking like in account of the three or five minute time frames for hard closes so what is the time frame relevancy in terms of um hard closing uh when you're diving something because it could car close on a one minute against your level but then you know so like this for example yeah yeah so in that case you always want to go and see if that level exists on another time frame right like that's the case right here where you want to see if that level also that one minute level also exists on another time frame so you can actually take this here too like this and uh see if that exists on another time frame so your greediest level here which is a one minute is also a three minute so you you definitely want to take into account that like when there's that level confluence there right like the one minute and the three minute the three minutes still has to hard close along with the one minute so you'd be looking for a three minute hard close against that level because there's a three minute hold here yes give you some some stuff like this where people do get out but then again that's part of deep diving right when you have a one minute heart one minute candle starts closing and there's just more incentive to buy it back up but that's where deep diving exists it's just so if that yeah if that level was purely a one minute to the 90 30 and there's no confluence on the three or the five that would be an exit point then the hard close yeah you would more be something like this at that point like let's say this one didn't exist right let's say this is a white candle here on the five minute but this does exist and this is the five minute and this is the one minute you'd be looking at this five minute to close and this one minute to close so you'd need both of those to close okay see what i mean if this didn't exist on the five minute but it does exist on the three minute as well so you need the three minute close and you also need the five minute close here so you need like all three to close there and there's of course no 15 no hourly none of that stuff there so so if they close on those time frames you would expect the move to lose that range then yeah that's where the uh moves they die out and that's that's where they fail and die interesting that's a tough one to stay in for i suppose say five minutes or whatever would you stay in for about four or five minutes there would be any sort of early warning sort of idea i know i supposed to five minutes so i think that's where deep diving exists so so frequently because you do have those instances where you have a level like you know it looks like it happens here let's find the level here three minute here goes too bad goes through this here's the three-minute level where's the five and then the five is right and that's tested so your five is actually right there do this [Music] three do this one on five is our 15 there is a 15 right here as well the center line these things can't really see them can you center a line then we go to a one minute here and find the greediest one minute level untested which is right there so this one's tested that's dusted this is not the range is tested so you could say that like this is it right here but you know you could also comfortably say it's right here because this is the back side of that range so that's fine you can say this is the one minute this should be where it is and then it just gets front run so then you see 1998's 91 1999 is level so it's a little one minute hits but there was also a one minute right here so people would say like oh this is like the perfect level and it actually is and you can even have a hard close on that one minute level because there's another one minute level with like everything in between right so you have a one here so you have like a one minute level that deep dives to the three minute to the five minute to the 15 to the not to the final one at the greediest point of the entire move which which is typically where something goes right like even here you're tested here right you're tested here right you're not tested well actually you are tested there you test it here you test it there you test it there here it's all tested like maybe this one is not that's it but and then even then the back side is tested so yeah the back side's not going to hold the smooth and then that's tested so then you're right here as the next piece here really right here so so then you can see where a one minute hole level should hold it down because look at the size of that valley but then the level just simply deep dives all the way up to 1999 and then if it would have hard close some of these other time frames right then then you're in a different scenario a hard close of three minutes which and then you even have another three minute year right so then you have this three minute right here which is like the greediest point not one minute so you have like a marquee of levels but it has to close these time frames so this is this is like often what you see like a level deep dives like here's here's your one minute hold level and and it deep dives how much like another 50 or something stupid 40 yeah and and it's just going after first off it's going up to the greediest level but then when you do have this happen you can have that little heart flows like this because simply when you pull this thing back like it didn't it didn't start to actually hard close any of its other time frames like the three minute is there the first five minute is right here it didn't close that right the first 15 minute is above it so it's just the the more this thing goes the more incentive there is to buy it like the quicker this thing is moving up without closing these time frames like if this closes and starts to hold that's different then maybe you start to close over this three minutes and that's when you start to like close over all these time frames on their own time frames but this is like the perfect example right here where you have a move and it just goes up 40 percent and then and then it pulls back because you have this marquee of different time frames that simply hasn't closed yet so yeah like to answer your question there devel and uh kg it's it's uh you're you can hard close one time frame but you also have to like check your other time frames just like we have you know in the moment right now with that three minute time frame but check the other time frames to see if the level exists on that time frame well to see if you hard close that time frame is more importantly we're not buying those but to see if it exists like where are we here like here for example here's like a perfect three minute this has to close on the three minute and uh i wonder if this is yeah that backside's kind of tested but here's a perfect three-minute level like this this has to close so yeah you also have a one-minute level here but it also has to hold that level for the three-minute candle close because you have both and technically you get a one-minute hard close and that's fine but in this case there's also a three minute there so you go to the three minute and there's no you know if you start hard closing the three minute here yeah the move's gone but then like this is deep diving right this makes it perfect to buy because the deeper it goes the quicker it can bounce up before that hard flows right so what's the um i guess right way to balance when like for example uh there was a time or a few times during our live trades where the you know the candle wicks down hard against the level that we bought against but it never hard closes but we still you know we say that there's a 50 chance that the next candle will just dump uh whereas yeah like the deep dive right but then um it never hard closes right so isn't that indication that even if it wicks down hard and it comes back up that it's holding that level i think it depends on what hole levels are there i think that largely depends on what type of hole levels are there i think that's different in every scenario like when you whip past the level that crazy and deep dive it i think you have to look at the levels and the trends i don't think you can make one scenario that fits all you have to be able to see it all and be able to digest it properly so even though that that kind of heart closing a woman with different heart closure and treatment it could just as easily have continued that one-minute heart close down to the base of that range that that greatest hole effectively i don't think it's going to happen in a one-minute candle i think you're going to have the three-minute close there but yeah it absolutely could have but i don't think it's gonna happen in a one-minute candle it never does it always kind of lingers around that level and when it's kind of hanging around a level that's probably hard closing a higher time frame like you see three or four candles linger around a level maybe right here it happens this is tested this is not if you've got something like this which presumably that's tested and that's tested so this is not tested by the we can say it is it's it isn't it isn't this isn't on this time frame but the other ones are [Music] one minute part of the move here also like a 15 minute part of the move right here the one above the one is the 15 we just have to remember that that's the 15. here's a good example what does it actually go after too does it even go does it even go do we miss something in here i've got to get the replay tool back okay you know what we can first look at this part of it that's fine we'll just do it right here and we're going to mark this as the 15. so so this is a scenario where you have that same thing like you've got a one minute time frame that hard closes right so you've got the one minute time frame that hard closes here so if you went up to the greediest level this moves down quite a bit 50 58 right deep dives it's level pretty hard but then do you actually even close anything on the time frame that's also created there like i would wonder if there's five minutes in here as well let's take a look there is there's a five minute right here which is the same thing as that 15 i suppose and then what about a three minute is there a three minute yeah but it's almost the same thing then while we're here is there anything else so that's tested presumably the five minute is tested as well then which it is the five minute is also tested about one minute is there anything even greedier here okay so you do have something you have this here you have this here oh you have a one minute there that's fine so this is a like this is like a perfect example where here you have a 15 minute here you have we need to get rid of this three and the five they're not important and they're just making it hard to read um here you have a 15 minute doesn't ever hard close out this 15 minute here is tested so it can't go after this one right it can't be this candle it's it simply can't be it can possibly be this right here at 89.65 which is interesting because that's kind of our level for today so you you have this 15 minute here which can't hard close you have a one minute here it indeed goes after the one minute here uh we'll go to one minute time frame you you do see like oh look this one minute hard closed right so i think this is where you have to understand where is the greediest level in the move because it's typically going to go out to that greediest level so so you have 90 54 90 30. two one minute levels take the greedier one as always 15 minute hard close if you start to close under here under that 15 minute right and you lose this one minute you're gonna be down here at 89.65 right so there's quite there's quite a big gap here this level here to this level here you're talking about 1.3 so if you were to lose this 15 then you're down in this range right did you take the greediest one minute or not so so i think this is always going to be the case when you're looking at that okay level deep dives what should i take right if it goes too far past my candle what is it doing and then sure we can find a spot where it just kind of lingers around a level and then dumps right like where's the knife caps that just kind of lingers around and dumps we're gonna find one of those that's just a straight knife catch that's a straight knife catch that's not really a dump come on one minute candles that's a knife catch a ladder [Music] it's a knife catch right here here's one one minute level hits that level greediest point lingers around that level loses its move right because this is most likely closing a higher time frame oh no no we don't want to do that i want to do this i want to do this three minute right here five minutes the same spot and there's no 15 there before the dump so so really all you have is a three minute you have a five minute as well but five minute is basically right on top of the one minute here so right here right and then and then you've lost that three minute you've hard closed the three minute and the one minute and then you just straight dump down right so that's that's kind of that scenario where it's like okay if it knife catches too hard and lingers around that level and this isn't that hard of a knife catch but it's the same illustration you're going to knife catch that level and it comes back to that area and just kind of holds price there it's likely hard closing a higher time frame i wonder if there's somewhere else it does that so so go to this move and you've got the greediest part of the move [Music] you've got the greediest part of the move and it goes and bounces right off that level and and here's the point where you're gonna start to lose that five minute after that one minute closes so here's like a perfect example something goes way the hell down right so so this is that that thing you were talking about what we were talking about there develop where you have a knife catch you've got your say you bought the five minute level now we know the one minute level is proper here but say you bought the five minute level you get the one minute properly and perfectly that five minute is lingering around right like this so so you see the same thing happen on one minute candles happens right here actually lingers around this one minute candle hard closest goes after the next one minute right this here is that same same exact thing where if you were to deep dive a level it's too bad this isn't a one minute because we've had these scenarios before it's a one minute deep dives like this when it hangs around this level you have to start to wonder like okay where's the 15 minute in this thing is it actually closing a 15 minute because you've got this here right and we're going to turn this one green [Music] come on seriously oh that's a text color of course and you've got this here this is going to be that same scenario where once you start to lose this level it's the same thing you just have to start looking at other time frames you can't be too inside of one minute level because when they deep dive like that and they hold that base of the move so that trade you talked about it goes down i wish i remember the price it goes down on the one minute deep dives one minute comes back up i get entry back out before it dumps down and i'm not i think some people held some people got out so the people who held probably held to the heart close of a higher time frame candle yeah that's a three minute as well right there three minute there here there's a three minute right here as well the one and the three are kind of at the same level here yeah so right here lose that three and it's just straight down right because as you're moving down you're just losing bigger and bigger time frames right try to find one more i think this is a super important question a very important distinction as well i want to find a spot where it maybe maybe it happens here no it just goes straight up there to 98 to 10 000. okay we've gone way too far back we got to find something more relevant more recent let's take the replay too tool off and try to find another spot here where it does that sorry um because it's just this is actually yeah i'm not looking at that you're picking say various time frames 3 15 minutes and there's probably higher time frames like an hourly you know candle there as well or whatever yeah are you looking for the highest [Music] one or would you be looking intermediate ones like you know so this is this is going to be a balance right like this is going to be a balancing act so you have for example this move today okay you know what let's go to the move today this is a good question because this is like kind of the perfect example let's go to the one hour as kg pointed out there's a one hour here today right here right okay so you have a one hour right here you also have a one minute right here oops should be like 47 or somewhere 46 yeah 46. so you have two candles here right and then you also have like a three minute and a five minute right here at 89.60 there's another one minute in here right here right so let's make the hourly orange as we always do we'll go orange text of course let's go orange for the hourly so so this is okay so here's a scenario where you've got an hourly candle you've got a five-minute level right here right we'll do the five-minute level and teal sure that's fine uh we're gonna mark this because i'm gonna get confused you've got a five-minute level here you've got an hourly on orange and these green ones are the one minute right okay okay so you've got this kind of spot where you're looking at this thing to come down today right and you're looking at the price and you're saying okay let's target oops let's target the hourly right that's fine the hourly is a great buy but if you catch this level down at 89.47 and you start holding down in this range like if you start holding down in this range here and you kind of come up here and fail down here and come up here and you you keep holding down here guess what you're going to hard close if you do it for long enough you're going to end up hard closing the hourly so so this is a point where you might say oh 89 62 is the one minute level it deeps dive all deep dives all the way down to 89 46 and then and then you can also even deep dive to trend here so i wonder where trend is oops let's get rid of that other brush stroke here too so you could deep dive to trend but if you don't start regaining price and knife catching this thing pretty fast you are you are going to lose the move you're going to simply just lose the move so you gotta have two possible trends or you could have this one and you could have this one here actually sorry this one should be right here to here yeah okay that's right because it goes into there and then it ends up being right here anyways so like you could deep dive either of these to these trends too even here so what is the price on trend it's probably underneath a level so you could probably deep dive even to this trend so so you're looking at this today and you're saying okay well we're where are we here where could we possibly go right you you could you could have the hourly at 89. okay it's the orange one 89.62 it could deep dive to this level it could even deep dive to this trend here down at 89 34. and come back up and over top of this one hour level that's perfectly fine it happens all the time absolutely acceptable go to any like one hour level you're gonna see it break over top of it constantly here's one right here and it breaks right over top of it probably hit a trend right because when a level or okay here's the top here it's a rate so right there and then this guy to here and it actually doesn't go after a trend it's fine it goes after its own one minute level but but nevertheless it's the same thing right like you can you can deep dive this level to whatever's here there could possibly be another trend here to here or possibly here no no trends so it's definitely not trend unless there's something on the four hour i guess we gotta check nothing on the four anything on the twelve nothing on the twelve and the two yeah it's a two hour trend so right there right so this is the trend you're trying to break on the two hour and it's still fine it goes it goes and does the exact same thing you have an hourly level and it goes over top of it towards the trend and ends up hitting the trend and and that's perfectly fine in this hourly level i wouldn't even say it hit that trend it probably just went after the greediest soul bubble like right here probably just one after this which i think we already looked at this and and this is what we said it did anyways yeah it goes there and then fine it goes after the next one which is up here and so that's fine it's still going after the one minute levels but uh it's a little bit away there not too bad but it's the same thing with this hourly candle right here like you have the hourly close it can absolutely go all the way down to what is this 89 46 here it could even go down to trend at 89 30 and then bounce up over top of this hourly but that's how deep diving works right you go deeper in moves for this exact purpose it's all about that hard close right so in in this scenario yeah you can go after the one minute and if it comes back up and hits this level comes back up and just kind of holds this realize that the longer it's holding this it's breaking this level here so that's that scenario where if you tried to buy here because it was one hour level comes deep dives like crazy even if it comes back up to this level right here and holds here it's the same thing you hold there well guess what you're doing you're breaking the larger time frame right so the longer this is holding without moving back up off that knife catch the other time frames it's breaking that you're not seeing [Music] and then say you have that happens you have a little hold here and it just goes straight through the hold because that's what happens sometimes on these deep dive moves right and that's typically because it's already so so you would have this move here and before this big dump down you'd say okay well i've got a whole level as long as it doesn't hard close close this i can be in this move but then what's happening in the time frames above right so it's something to be aware of