The Only Technical Analysis Guide You'll Ever Need (Beginner to Pro)

Technical analysis, a methodology from the Stone Age, or is it still effective today? Let's get to the bottom of it. Today I'll share 3 great insights that institutional traders have used for decades and still use today. But why do they do that? Point 1: What technical analysis really is and what it is not. Point 2: What the top 3 tools of institutional market participants look like and what they use them for. And point 3: How you can recognize in any market when the next move is coming and why it's happening, and that's very beneficial for you. So stay tuned. It doesn't matter if you're opening a chart for the first time today or if you've been at it for a very, very long time. Today I want to give you some great information in a very simplified way that will allow you to read the markets more easily, to recognize at first glance— we call it the quick look— what's actually going on in the market and whether it makes sense today to trade trend continuations, or if it's better to look for counter trades, meaning against the trend. And then we'll look together at what happens when a move occurs in the market and whether it's possible for you to recognize it beforehand. I want to show you how I use technical analysis to make it really easy for myself, and the whole thing in a bit of a multi-timeframe way from the top down. Let's get to the bottom of it together and examine how all of this can be beneficial for you to have simple tools that just give you a nice overview. Let's start here in the S&P 500. And what's the very first thing I do before I create the analysis for myself? I look at where the market is currently, and I can just mark that briefly. So, current price. And now, technical analysis is intended to see where supports are, where resistances are, and where I can assume that the market will make a quick move. Therefore, we go up from that point and locate a high point. Let's go down from that point, and now we already have this one and this one. That means two pieces of information. Upwards, we actually only have one. And now it's already starting. If I want to create a technical analysis here, how do I evaluate which of these points is decisively exciting for me? And I can tell you, I always take the following path. I always look at what phase we are currently in. And here you can see, for example, that the market is right in the middle of the previous phase. And being right in the middle instead of just being there means we're currently moving sideways, we're consolidating. And when we consolidate, the possibility of a quick move occurring is smaller for me than when we break out of a consolidation, but we'll get to that in a moment. Now let's look together at how we can methodically build this up for ourselves to gain added value. The first thing I do is place corresponding guidelines at the absolute high and low points from my previous assessment of where we stand. Where's the top? And where's the bottom. And for me, for example, the closing prices and the market opening prices are usually much, much more important than the absolute extreme points. Nevertheless, the extreme points are interesting because that's where acceleration often occurs. But what can we do now? By identifying these high and low points, we can first get an overview for ourselves of where a market might slow down and where a market might break out. And to localize that correctly, I'm going to take it one step further now. And now I know that many people do technical analysis in such a way that they, for example, let's say a market started here, and now we have increasingly higher low points, or this one is suddenly lower. Now a trend reversal should actually occur, and then we have increasingly higher highs. And that is a common analysis that is very, very popular among major market participants. In addition, they very much like to use a so-called moving average, usually calculated over 200 days, and then it looks something like this. And they claim that this moving average— let's just take an SMA 200, which is a simple weighted moving average that says nothing more than what the average price of the last 200 days is. It looks like this. And now you can already see here, for example, the market is sometimes above, sometimes below, sometimes above, sometimes below. And many institutional investors simply say that if the market is above the 200-day line, stability is present. If it's below, caution is advised. And as you can see very clearly here, for example, there was actually a point where we could have said lower highs, lower lows, we have a massive trend reversal. But then something like this suddenly happens, and now the question is, can I already localize before we go above this that there is a probability that the market will now move upwards? And to that I say a clear yes, and I want to show you why. I technically define the market into so-called sideways phases, and I'll just start right here and take this one. This is just an example, and let's see why it makes sense in a sideways phase like this to think about when does the real breakout happen. And you can see that beautifully here, that the market eventually traded beyond this sideways phase. But what did it not do? And I can highly recommend that you really examine what do the impulses look like when a market leaves such a sideways phase. Before we get back into it, a quick notice: World Class Edge just launched. And if you want to know How really institutional traders and market makers actually trade. Click the link below and secure your spot at World Class Edge. All right, back to it. And, and this is the most important thing: does another sideways phase emerge after that? Then we have a new model where we can clearly say that the equilibrium, meaning the new acceptance, because the market then spends more time above or below there, has explored a new price range for itself. And additionally, there was also a dynamic impulse relative to the previous sideways phase. This dynamic impulse is always very crucial for me. And if we examine that here now, we see, for example, the market ran down here, it ran back in here, and this is where the first dynamic impulse already occurred. And if I use a technical methodology and look at this trend here for myself, or look at this trend here, then I already see a huge difference. This here is a so-called creeping trend, a creeping trend. This here is a so-called fast trend, a fast aggressive trend. And this trend has short stopping points. Remember, these sideways phases always give us the opportunity to see where liquidity is being collected. And now the following happens here, where we actually assumed that the market would now complete a trend reversal It didn't do it because it neither provided us with this information here, nor did it provide an impulsive fast downward movement so that we could have localized that there's now a sustainable imbalance in there. There's now a sustainable imbalance in there. But now let's look upwards and see with the break above this and above this level, the market started up here to accept new price levels. And you can see that beautifully here. That's also the reason why the market was later able and willing to accept higher prices at first, because it said, here is the absolute base that was created to drive the market further up with fair valuations. And now we're here. So what should we keep in mind? This price range here is the most exciting price range Once again, please refer back to what I told you here. Here is the move, and here is the balance. And that's why this price range is the most exciting one for us, where we know a reaction is likely to be significant if it returns there. And now let's move further up and take a look at the whole thing. Now the market says, okay, This is where we are. And what is this right here? Nothing other than this right here. And that's why technical analysis only makes sense to me once I've understood this basis from impulse theory and from the development of equilibrium, where I can assume that many market participants simply feel comfortable Now let's take a quick look at a smaller time frame to see how that can help us. And now let's take a look in here. I've just chosen the 30-minute chart for now, and look at what happened here. Right here, the market delivered this dynamic impulse, and here the market then said, I accept these higher prices. And that's exactly the reason why the market tested this dynamic price range here and moved back up again. It accepted the market here in this particular location, and as a result, things changed. And when I see something like that, I immediately see where was the impulse range there. And look here, here was the impulse range. And what did the market do? It tested again. And then the logical consequence is that these tested levels and it's important that you do this, you check them off and know it's already been there and there. And then you also know, should it return there, the probability is higher that it will fall through. If they're untested, they're great price ranges where you can assume the market will carry out a corresponding reaction. And I always have to say, for me, for example, up here where I've located where the last high is, where the last low is. It's incredibly important where the last sideways phase was, which— and here comes the crucial part— hadn't been tested yet, and that is here. And then I also know that if the market goes above this point, I can already trade a breakout before it takes out the high. And thus have the opportunity to simply participate in the acceleration accordingly before the absolute acceleration comes above the last supposed highs. Therefore, always look at the large time frame, for example daily, to see where the top and bottom are, and then in a smaller time frame, like here for example 30 minutes, to observe where the last balance is and where it isn't. Where there are impulses and where there aren't. It's a completely different approach. And if you then know where, for example, large market participants use 200 moving averages above or below, and you bring that into this combination, then you have a huge advantage and know much sooner when the thing breaks and when it doesn't. Therefore, it's not quite as important to know where the top and bottom are. It's much more important to know where balance is, where impulse is, and then to establish the connection, at which point the probability is high that we can enter the market beforehand, or where the probability is also high that the market will react accordingly to counter trades. I enjoyed explaining that to you. I'm curious to see how you like it.