Hey guys, today I want to introduce you to our new course – horizon for beginners.
Generally, when someone starts learning how to trade, they look up a lot of unnecessary info, like indicators, strategies and stuff like that. And most of it is a bit crap. That’s why we compiled all the needed information and compiled our newbie course for you – horizon for beginners. It consists of 5 lessons:
1) Market impulses
2) Imbalance levels
3) Entry points
4) Money management
5) Practical training
In this chapter, we’ll start with market impulses.
Before we start, let me explain what this strategy is based on. It’s based on the classical rules of supply and demand. Here is a chart that depicts this principle:
Now, we always want to start with a point of equilibrium, that being a place in the market where buyers and sellers are in balance. You can see them marked on the chart above. But if demand drops, so does the price, and vice versa. This is a cornerstone of our strategy. On a chart, if we have an equilibrium, and then an imbalance occurs, it takes the form of an impulsive movement. Here you can see how that looks going Up
The point where the impulse starts is very important to us, as it shows where an imbalance between buyers and sellers was formed. To identify such a movement we use candles. Candles are tied to timeframes, so if I’m on an m5 timeframe, every candle is 5 minutes worth of price movement.
There are two types of candles, bearish and bullish. If the open price was higher than the close price, the candle is bearish, and is the close price is higher that the open price, its bullish.
Lets move to a chart and try to identify some impulses
To refresh your memory, an impulse is an imbalance between buyers and seller, and on a chart, this is going to be vertical, and only significant movements.
Find an impulsive zone and mark the wicks, as above. A very common mistake is thinking that something like this is an impulse
This is not so, as the angle isn’t quite vertical enough.
Another way to mark an impulsive movement is to mark the preceding consolidation
In 90% of situations, a micro-consolidation forms, and this you also mark by the wicks
Here you can see how the price reacts to this level, but we’ll talk about that on the next lesson.
Here we see another impulse, it’s better if your perceived impulse consists of only a few candles, 4 at most.
Here we can again see how the price reacts to this level.
And here we see another impulse, 3 candles, and we can mark the consolidation as well
I prefer consolidations, as it’s a moment of balance before someone takes over the price, so here, a big buyer.
Here’s another one, with a consolidation to boot.
Seems easy to me. There’s some homework, so don’t forget to do that.
Thanks for reading and have a good day.