Original subtitles

0 Welcome, everyone, to the next lecture in Section 2, where you will study all the support and resistance 1

trading strategy will offer great trading rewards when applied on particular timeframes 2

when compared to others. 3

So far, guys, you have studied how price move sideways, irrespective of the timeframes before the 4

breakout occurs in the direction of the larger trend or the larger trend reverses. 5

Therefore, price consolidation within support and resistance zones apply to the smallest timeframe 6

available on your trading platform, as well as on the largest timeframes. 7

However, I always encourage the use of 4-Hour and above time frames for trade entries and analysis 8

using the support and resistance trading strategy because of its three main advantages it offers in 9

terms of pattern, price and time. 10

Firstly, the biggest advantage of using larger timeframes is that closing price of any candle represents 11

the true market activity. 12

This means that market professionals on larger timeframes less manipulate price and hence we can apply 13

our trading knowledge with greater confidence. 14

The order of high-to-low manipulated timeframes is as follows. 15

Those who don't know, what market manipulation is: Market manipulation is defined as the dramatic rise 16

or fall in the price of a trading instrument caused by legal authorities such as central banks, government 17

and large trading partners. 18

Therefore, guys, as I mentioned above, as a small trader or a retail trader, our best profit making 19

opportunities arise when we trade on larger time periods in any freely traded market. 20

Hence, the various candlestick patterns you study later in this course carry much higher significance 21

on larger timeframes when compared to similar patterns on timeframes of 1-hour and below. 22

The second reason behind choosing the larger timeframes lies in the fact that there is an opportunity 23

to capture larger moves in terms of price. 24

As a disciplined trader, you will look to capture the trades which carry lower risk-to-reward ratio. 25

Personally speaking, I always take positions where my risk is always less than one. 26

This means that the moves I'm anticipating yield higher profits or rewards for me when compared to risk 27

associated to each trading position. 28

Therefore, choosing higher timeframes allow me to capture moves that lasts for a few days on 29

4-Hour timeframe, 10 to 15 days on daily timeframe and so on. The third and final reason is time. 30

Trading is a difficult business, and looking at a trading screen constantly in search for quick profits 31

on smaller timeframes affects the trader mentally. 32

This is where the biggest disadvantage lies when it comes to pattern and price we discussed above. 33

Because of the market manipulation, it becomes increasingly difficult to secure consistent profits 34

and mostly you will end up with small profits or worse, losses while trading on short-term horizons. 35

On the contrary, choosing a larger timeframe allows you to sit back and watch the markets do their 36

work and you only close the trades when markets tell you to. 37

In addition, if you're someone like me who has other commitments, you can effectively trade markets 38

by spending around 1 to 2 hours every day to analyze the markets for new opportunities and to manage 39

your running or existing positions. 40

Traders, I'm confident that what you have learned is enough to change your trading habits. In this strategy 41

and course, you will also learn about my mindset towards market and how I'm always maintaining my patience 42

to keep my trading stress-free and enjoyable, to generate consistent profits. 43

This also concludes the section 2 of this course. 44

And I will see you in the next section where you will study a professional approach used while labeling 45

the support and resistance levels.