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TECHNICAL ANALYSIS DOES NOT WORK!.. (Here Is The Missing Piece To The Puzzle))

TECHNICAL ANALYSIS DOES NOT WORK!.. (Here Is The Missing Piece To The Puzzle))

technical

analysis

alone will not make you a profitable trader you could know

technical

analysis

like the back of your hand that's new just kidding you could know

technical

analysis

it's like the back of your hand and you still would not be a profitable trader because it's a very small

piece

of a very large

puzzle

so what are the other

piece

s that you need in order to create a successful trading career outside of just

technical

analysis

we're gonna go over that in today's video so if you're new

here

go ahead and click that subscribe button down below the video to the right-hand side click that like button follow us on the social and I'll see you in just a second let's jump right back on topic why is

technical

analysis

not enough because

technical

analysis

by itself means nothing without consistency consistency is a set of rules that you trade based on you can know

technical

analysis

have a deep level of understanding of how charts move a deep level of what trend is structure is every candlestick pattern that's ever been made can be in the front of your mind but you will not be profitable unless you trade in a consistent way based on a set of rules trading with

technical

analysis

and with no consistency it's like having a nail and no hammer it's not gonna be very useful to have that nail if you don't have the hammer that's going to help you drive it in so without consistency you will lose trades which is why

technical

...
technical analysis does not work here is the missing piece to the puzzle

analysis

by itself is not enough imagine this this is gonna be semi dark a metaphor but it's the first thing that pops in my head imagine that you are going to have to have a kidney transplant a terrible situation for anyone but imagine that you have a choice in the physicians in the doctors that are going to perform this transplant surgery option 8 is a doctor and he consistently performs the surgery inconsistently let me explain he uses different tools every time sometimes he uses anesthesia sometimes he

does

n't sometimes he uses a different process for actually removing the kidney than other times and he has a survival rate of about 55% that's option a for the physician that's gonna take out your kidney option B is a doctor that performs the surgery extremely consistent consistently every single time he uses the same exact tools and the same exact process each time and has a very good survival rate which one of those two doctors do you want performing transplant surgery on you if that was something you had to have of course it would be option B trading is the same exact way you need to be placing trades in the consistent way using the same tools and the same process every single time before we get started with the actual

technical

analysis

that we are going to do I'm going to show you a few of the trades that we took this week I'm actually to show you the last five trades I took and show you a systematic process that I used to take those trades they...
technical analysis does not work here is the missing piece to the puzzle
help you better understand creating a rules-based system after learning and mastering

technical

analysis

that's what will put you on the path to successful trading not just knowing successful not just knowing

technical

analysis

excuse me but when I first started trading personally I'm she give you a little story about how consistency changed literally my life whenever I first started trading of course I was trading on a point a day trading time frame I was trading based on what other people said on a forum or some kind of signal service that I took part in and I was trading extremely inconsistently sometimes trying to trade on my own based on a number of different candlestick patterns or a number of different

technical

analysis

setups like support or resistance and really what I was trading based on is the last strategy I saw on YouTube and I'm sure you can probably relate to that you see something a bright shiny new object like a new strategy and you end up trading based on that strategy a few times you lose a few trades and you switch strategies again that's a huge problem I had at the beginning of my career but once I mastered what I'm going to show you in this video and actually started trading based on a systematic approach a rules-based approach my trading turned around completely and that was the first year that I actually saw a profit by the year's end so I'm going to show you how to do that in this video first off let's take a look at...
technical analysis does not work here is the missing piece to the puzzle
the last five trades I've placed in the market let's do that right now so first off the proof factor let me prove that this is a trade actually took and instead of going to my broker's account and showing you the value of that which is something I do not want to do I'm gonna go to our e-mail

analysis

which was owned 1118 I sent this email out to all the traders involved in the EAP training program and as you can see it was a Canada Swiss short trade which I'll put on the left-hand side of your screen might be you're right I really don't know I'll put it on the screen somew

here

so you can see that email

analysis

see the entry and the exit points that I had out so as you can see we ended up winning this trait ended up pushing up actually almost hitting our stop-loss not quite getting t

here

though and then pushing down and hitting our targets today as a matter of fact and what I'm gonna do is talk you through the

analysis

behind this trade it wasn't just

technical

analysis

as we discussed earlier in the video just having

technical

analysis

with no consistency means nothing for your trading knowing

technical

analysis

does

n't make you a successful trader consistently placing trades on a set of rules is what makes you a successful trader those rules although those rules must give you an advantage over the market or an edge over the market and I'm gonna discuss some of the rules we use to get involved in this trade or the rules that I...
use to get involved in this trade right now so for me specifically looking for reversals which is what this trade was based on what I look for with a reversal it's a market that's breaking into new lows so if we have a market that as this pound allsey excuse me canada swiss i was talking about a different rate as this canada swiss is went from this uptrend scenario to creating new lows

here

we break we've broke below a bunch of these lows we're still not in a downtrend we still haven't necessarily reversed why is that why haven't we reversed because we haven't created a one two three move one two three moves show me that we're in a reversal so in this case i knew that we were in a what I call bearish rotation a possible reversal but we weren't necessarily in the complete reversal yet so I had to wait and be patient another huge part of trading is patience for this market to push up and then push down breaking below two so this was our one two three move super simple right let's go over it again waiting on the market to push down push up and then push back down we're literally counting numbers this is back like grade school yet again one two three so we have this one two three move a reversal scenario that I love trading and this is the part we're not just looking at

technical

analysis

right I didn't just say we have

technical

analysis

here

we have support and resistance no I have rules this is the process of creating a...
system that's based around rules or a strategy that's based around rules that gives you an edge over the market so I know that my rules state that I need a one two three move for a reversal that's the beginning stages of a system so I have my one two three move once I have that one two three move I know a very likely place for this market to continue in trend after a reversal like this is back at the previous point of structure that was broken which was right

here

we have highlighted in black that was the last level that was broken as structure support which could now turn into resistance especially in reversal scenarios now some things you can do to even more so increase the consistency of this and possibly a profit potential is add on something like a moving average so now what you could say in order to create rules around this situation not to just say I know

technical

analysis

but to create rules around it so you have a systematic approach a rules-based approach is to say I'm waiting for the market to reverse after being above the 200-day 200 period in this case moving average I'll wait for the market to break below the 200 period moving average create my one two three reversal setup at that point I look for trading opportunities at previous structure support or resistance that was broken this case is bearish so it's support that was broken and that's w

here

you would look for possible trading opportunities do you now see more so the difference...
between

technical

analysis

and having a rules-based trading approach at this point you have a rules-based trading approach you can take this and in order to see for yourself if it actually creates an edge over the market you have to go out and test it go out and test the scenario over and over and see how many times it creates a successful trading opportunity but we're not done yet having these are called conditions I'm not going to write out conditions but I will put C to help you out conditions after conditions we're gonna need a reason to actually get in the market so what's next is having an entry reason at this level what's your entry reason going to be you can have an entry reason that's like a price action pattern double tops head and shoulders patterns you can have an entry reason that's just a candlestick pattern such as shooting stars in this case or a hammer candle in the case of a bullish move and of course I am the best person at drawing you've ever seen that's sarcasm I am terrible at drawing especially with a mouse so don't hate on my drawings but in this case you can see that the market came back to that level we ended up with an entry on a lower top frame in the EAP training program which you can see right over

here

we ended up with an entry that we got on a lower timeframe and ended up being a profitable trade the systematic approach benefitted our trading not only in the fact that we consistently place trades in the...
same way or that I consistently place trades the same way EAP members tend to do the same thing but also in the fact that it won it was a winning trade well that always happened absolutely not but if you have a consistent approach that gives you an edge over the market you come out the winner every time so that was the Canada Swiss trade that's a way of actually approaching the market with a rules-based system instead of just using

technical

analysis

and calling yourself a

technical

trader you need rules you need consistency and this is how you create it so let's go ahead now and take a look at a few other trades that we had throughout the week we'll go down now we had the Aussie yen short trade which I'll also put on your charts the Aussie yen short trade is right

here

this trade ended up pushing down and luckily for me I actually saw this trade when we were one pip away from hitting targets right

here

at this level and I took my profits off to pips I think it was away from the actual target although we didn't hit targets and otherwise if I hadn't seen this right at targets I would have been stopped out for breakeven as close as we got to targets but look at the draw I ended up winning the trade and the trade was based on a very similar situation let's take a look at it so in this case we're looking at a market that has been in a uptrend right over the 200-day moving average this is I don't necessarily use this exact system or format for...
my trades using the 200 period moving average and all this reversal scenarios I have a certain system I use that stall in the EAP training program that I use on a daily basis but this is the exact same approach I took to creating that system if you're not in a position to purchase trading education you can do it yourself it may take you a little more time to create the system yourself but this is the process you'll go through in order to do that in this case we have an uptrend above the 200 period moving average we have a market that pushes down below the 200 period moving average and pulls back up to it after the pull back up to a 200 period moving average that lines up with previous structure support and resistance you see

here

this is just another situation w

here

I'm adding rules I'm literally creating rules you can take and write these rules down and test them in historical data to see if they produce an edge of the market if they do then not only do you have a

technical

analysis

approach but now you have a rules based approach to trading as well so a rule could be break below the 200-day / the 200 period moving average when we get back to that 200 period moving average excuse me if that's an area of resistance and support looking left then it's an area I look for trading opportunities then you create your entry and then you test it and historical data you're gonna see that that process remains the same so that was a winning trade we had as...
well and we're going to go now to the next email

analysis

we had I'll take a look at that and talk you guys through the

analysis

behind that trade it was on the euro New Zealand I'll put a screenshot up on one of these sides I'm not really sure which side it's gonna be on this camera confuses me because sometimes it's on the right my right sometimes it's on my left I don't even know so the next one was only euro New Zealand that we had this trade ended up just being a regular trend continuation trade in terms of

technical

analysis

before the trade rules based

technical

analysis

we in fact have our one two three move we have our previous level of structure looking left right

here

and we are able to place trades in that area based on certain entry reasons again that are taught in the AP training program so that's what we did

here

and that traded up winning we're actually still involved try to get some second targets out of this I'd love to see this market come down

here

this will be the area I look for second targets is this next level of support right

here

and that's the next thing I'm looking for on the euro New Zealand on this specific trade we have our trend continuation level and we ended up going down to a smaller time frame but you don't necessarily have to have to do that as I said earlier your trading strategy your rules-based system can be extremely simple so simple in fact that you could have traded based on the...
shooting star candle if it's something you've back-tested seen to be profitable and decided to use in your own trading don't go out and just start trading shooting stars and hammers and as a matter of fact let's go through this for just a second just a little curveball from the video we're doing right now shooting stars and hammer candles again incredible drawings I know our candlestick patterns used by a variety of different traders that perform

technical

analysis

in order to trade but do you think if you go through the markets and you test every single hammer candle every single shooting star camp candle that you'll have an advantage over the market from my testing the answer is yes but it's very slight we're talking between 54 and 60-ish percent of the time depending on the currency pair 60 being the best currency pair t

here

is to trade these types of candlestick patterns on between 54 sometimes as low as 51% accurate is what these candlestick patterns are if you just trade them by themselves but the point of using these candlestick patterns is not to trade them by themselves but other than that it's to have consistency consistency in your trading is in a consistent way you place trades when you see this candlestick you go okay I enter a trade and now you can take that information and you can back test it and you can say only enter on shooting star candles that are at previous support things of that nature it adds consistency and gives...
you that slight advantage plus you're adding conditions that give you even more of an advantage over the market and that's the process of creating a trading system now let's go ahead and move on to our next email

analysis

which is going to be on let me see

here

going back the 19th we had a euro dollar email

analysis

that was a one target winner and guys I actually just opened up a pre Black Friday sale for the email

analysis

program if you're interested in getting email

analysis

like this three to five times a week and learning the exact system rules based strategy that I use in my personal trading then make sure to click the link in the description to take advantage of this pre black friday cell I'm only gonna let about twenty-five people in for the pre Black Friday sale so you'll get it for the same exact price we're gonna be doing a huge discount for Black Friday this is kind of just a prequel to that click the link in the description labeled EAP pre Black Friday sale to take advantage of that and become one of the twenty five new members if not totally cool we're gonna jump back into the euro dollar trade which is on your screen again to the right or the left not really sure but it should be on the screen in this case we had a trade down on hourly timeframe and I'm just gonna be straight up we took this trade based on a double top we have a double top right

here

okay we have this double top let me grab my pin right

here

and we had a...
nice reason for entry at the second top on a lower timeframe but essentially this was based on a double top so we have a double top but what made this double top more accurate again similar to shooting star candles or hammer candles if you take and test every double top you see and every double bottom you see you will have a losing strategy if you trade every single one of them you will lose money but if you trade retest test don't go out and trade this I'm not a financial adviser than in no way giving you advice on what to do with your money but if you take and test this every single time it happens in the market double tops or double bottoms you will lose money doing that but if you take and test these at specific areas in the market w

here

you've created rules such as our reversal areas or our trend continuation areas looking left

here

we have a double top at an area of resistance and support I almost said report kind of combining resistance and support which essentially I guess you could say this mark is doing so not really a bad thing but combining the double top scenario with this level of support and resistance that's been tested multiple times is what gave us an advantage in what ended up making this a positive trait of winning trade as you can see had a great week so far winning four of the last trades that we had or that might be three can't really remember let's go back nope that was four and four the last trade we're gonna take a look at...
was on the pound Ozzy this is our last email

analysis

trade which again I'll put a screenshot of beside the chart now and as you can see this trade was actually sent out earlier today are kind of like a 4 o'clock a.m. thing I wake up extremely early to look at charts in order to trade the system that's in the EAP training program in order to trade the system I trade I'll wake up every four hours to do so so I was up extremely early for this trade saw a nice setup on this pair and went ahead and take took advantage of it reason being we're essentially in an uptrend for sure and if we look at a daily chart something I love about this trade I'm gonna give you a little extra tidbit

here

on a daily chart we had this incredible smooth breakout of this flag pattern once we broke out of this flag pattern I started looking for long opportunities so another rules-based way to look at the market instead of saying I just know

technical

analysis

is to say ok after the breakout of specific patterns on a daily chart I can go to lower timeframes and look for situations patterns and entries in that specific direction so in this case it was looking for long trades after the breakout of a flag pattern we go down to a smaller time frame after the breakout of this flag pattern we had a couple opportunities to get involved and we ended up getting involved back in a previous level of support that was also a level of resistance looking left multiple times we ended up getting...
involved based on that as you can probably see at this point a lot of my rules a lot of the systematic approach I use in order to place trades as revolves around structure and trend which i think is important for any

technical

trader you must master those two and then create rules for the in order to trade based around the next step is to create entries in order to create that full system then what we're gonna talk about now is one of the most important steps that's hardly ever discussed discipline and risk management these traits that I'm talking about just because I had five winning trades this week and five winning trades came through the email

analysis

program that

does

n't mean that we win all the time I'm gonna bring up the actual spreadsheet from the email

analysis

program and in it you will see that we win about 59 percent of the time so far in 2019 that's a great winning percentage for us most of the time it's closer to 55 so we ended up getting a little higher winning percentage this year but that means that 40 out of every hundred trades I place are losing trades right what you see

here

is the spreadsheet from every email

analysis

we've sent out throughout the year of 2019 we have an average risk reward of 1.16 a winning percentage of 59 percent we've made about 72% we've had a 19% drawdown what

does

that mean this is really w

here

you need to focus is on your drawdown you want to lose as little money as possible you want to...
make sure you don't lose your account so in order to do that you need to adjust your risk management plan your risk per position losing 40 out of a hundred trades like this do you think I would be able to lose six or seven in a row which I've done this year I've done that in 2019 and have a 10% risk if you're risking 10 percent of your total account balance and you lose seven in a row you just subtracted seventy percent of your total account balance do you know how difficult that's gonna be to get back for this reason it is highly better for any trader including myself to risk one two at maximum percent of their account I'm not suggesting you do this you may want to risk way less or way more depending on your risk tolerance completely depending on you you make your own decision don't take this as financial advice but if you're risking 10 percent 5% of your account on trades I even the the accuracy I have as a professional trader I wouldn't be able to handle this risk because it put me in a drawdown of fifty or more percent I don't want a 50 percent drawdown I can't handle my emotions at a 50 percent drawdown these strategies and rules based systems give us an edge over the market but that edge over the market exists in a world w

here

you will have losing trades if you have an edge essentially that's what that means you might have a 60 percent chance to win but you're gonna lose 40 out of 100 trades in that scenario not...
that's not an exact science of course but just for example sake you lose 40 out of 100 trades your risk management plan needs to be small enough needs to be appropriate enough that you losing those 40 trades no matter how many of them come in a row you stay sane you say you stay disciplined and most of all you don't lose your entire account or get to a point w

here

you can't trade anymore because you're emotionally unstable it also having this better risk management plan will help you become a more disciplined trader you can't have discipline with a terrible risk management plan you you won't be disciplined to a trading strategy that's losing 50 percent of your account I promise you so risk management plays a huge role in discipline another thing that plays a huge role in discipline is demo trading and back testing you must understand your system in and out the rules-based system you create in order to stay profitable with it this video is going to get super long if I don't end it

here

if you were interested in more information like this if you're interested in learning the strategies systems that I use the risk management techniques and discipline techniques that I use the same system that's helped plenty of traders just like you come from exactly w

here

you are and become professional and profitable traders then t

here

's a link in the description for the EAP training program of course t

here

's no guarantees

here

you are going to...
have to put in a load of

work

and t

here

fore for that reason it's based on you whether or not you become profitable I can't guarantee your success but we have had traders come out of the program much better than they went in so if you want to get your hands on that first 25 pre-practice friday cell click the link in the description I'll see you t

here

otherwise check out this video on the other side of my face and check out some other content just like this with that said click the subscribe button the like button and I will catch you in the next video best of luck in your future trades talk soon