Planning Forex Trading - Part 2

Let’s start with the weekly here. The first thing I am going to do is zoom way out. The reason why I want to zoom way out is I want to be able to get a bird’s eye view. What this is going to do for me is; let me change my scaling here.

What this is going to do for me is let me know where some of the major areas, the big money, have come into the market. Now how can I tell this? You can tell it very easily because that is where you see these patterns that I am talking about in the course. In fact, you can see here; what’s this? Well there is a pennant pattern. A pennant pattern is a consolidation pattern. You can also see an area back over here where there is a sideways consolidation. This is where the market tried to break through to a level to the upside and it couldn’t. So it eventually broke down.

You can see this is a major move to the down side. I can see that there is an area right here on the chart. This is a little secret that I do mention in the course and I think I gloss over it a little bit. I want you to remember this. The other reason why I zoom out; do you see how there’s no real detail on the chart? You really can’t see what is going on? You just see a bunch of wiggles and whatnot. What I look for on the chart are these really dark areas, like right here and right here and gain, right here. When I fill these in, now, doesn’t it look obvious that there is an area right there? You can see now that there was consolidation. Remember we are looking at a weekly bar here. So for weeks and weeks at a time, the market didn’t go anywhere.

We don’t have to know why. The one word I want you to flush out of your mind when you are analyzing the market, there is this whole idea of why. I don’t care why. All I want to do is to make money so I don’t care why the professional money was working around in there. All I want to know is if they were.