All language subtitles for 2. How can we analyze a chart from scratch

How can we analyze a chart from scratch?

This is one of the first obstacles a
novice trader must overcome when trying

analyze charts from the point of view of
price action and volume.

The first thing to say is that when it
comes to a chart, the cleaner, the

better. There's no point in having lots
of objects or indicators on it.

The only thing this does is hide the
most critical piece of information, the

price. Our first goal is to determine
the current long -term context to know

the market is in a trend or in a range.

There is no designated timeframe for
each objective.

I always say that it will be the chart
itself that tells us which timeframe is

best to use at each moment.

For reference, the long -term context is
generally best identified on either

daily or weekly charts.

Depending on the history of the asset,
sometimes just looking at the H4 chart

may be enough.

While on the other occasions, you will
need to look at the monthly chart, but

a general rule, most of these analyses
will be daily or weekly.

Once on the chart, the first thing we
are going to do is find where the latest

sideways movements are with respect to
the current price.

This sign will give us the current long
-term context.

Here, there are only three options and
each one offers us a different context.

The identification of the context will
answer the first and most important

question for our subsequent trading
approach.

What kind of strategy are we going to
look for?

In other words, what do we want to do,
buy or sell?

In which direction is the greatest
control of the market?

These key questions should be resolved
in this first context analysis.

In short, it is about establishing the
directional bias of the market.

Once we are clear about the bias, The
strategies we will implement must be

aligned with it, so we always try to
trade in favor of the least resistance.

That is, if we see a distribution
structure above, the context will be

and therefore we should look for selling
opportunities.

The market is unbalanced to the downside
and we should only be looking for short

buys.

Later, we will see up to what point. For
now, we are sticking with the key

concept that the path of least
resistance is downwards.

If we open a chart and do not see an
accumulation range below, we will

the context as bullets, and therefore we
should look for buying opportunities.

Unlike the previous example, in this
case, the control is on the side of the

buyers. Most market participants have
agreed that the asset is cheap and

higher prices.

That is why we should only be looking
for long positions.

Finally, if we find ourselves within a
sideways movement, The context will be

neutral and therefore we should look for
trades at the edges, in other words,

look to buy at the lows of the structure
and sell at the highs, or do absolutely

nothing and wait for the imbalance to
occur.

It is during the development of these
ranges that we put into practice all the

analytical tools that the methodology
offers us to try to discern what is

happening and where the market is most
likely to turn.

Fundamentally, most of the participants
consider that price and value converge

approximately in the entire price range
covered by the structure, and therefore

a movement towards the high part is seen
as an opportunity to sell, and a move

to the bottom of the structure would
present an opportunity to buy.

Up to what point?

Well, as we saw with auction theory,
this will continue until something

at the fundamental level.

that changes the valuations of the
agents and the price leaves this

zone to look for another one higher up
or lower down.

As we can see, this first overall
analysis to understand the current

is fundamental, since it will determine
how we are next going to proceed.

The market can only be in two
situations, a range or a trend.

Within these, there are only three
possible trading contexts.

Look to buy if it is in a bullish
context.

Look to sell if it is in a bearish
context.

Look to trade at the edges or do nothing
if it is in a range context.