In this lesson we’ll go over the importance of the Daily timeframe chart for us day traders. You’ll learn how to read price action on the Daily chat to identify trends and significant support and resistance levels.
Key topics from this lesson.
The Daily timeframe is great to use as a directional bias for intraday trades.
When we’re Bullish, we want to see breaks above previous resistance levels, and we want previous resistance to turn into support.
When we’re Bearish, we want to break below previous support levels, and we want support to turn into resistance.
Bullish Trend = Higher Highs & Higher Lows
Bearish Trend = Lower Lows & Lower Highs
(03:52) Look for breaks of market structure as early signals that there may be a flip in trend.
(04:05) The market is always looking for areas of liquidity. If we place our minds to think like market makers, we can look to target areas where there may be pools of stop losses.
(07:10) Finding Supply / Demand zones. Supply zones can be spotted by looking for bullish candles immediately before a big bearish breakdown. Vice versa for Demand zones.
Supply & Demand are what drive the markets. Supply zones are formed when smart institutional money sell their short positions, drive price up higher, and then sell into that small bullish rally that was created. Look for Supply zones to act as resistance when price returns back to them.
Demand zones are formed when smart institutional money sell their long positions, drive price lower, and then buy into that small bearish rally that was created. Look for Demand zones to act as support when price returns back to them.
Trading is simple. It’s not easy, but it’s simple. Our minds and emotions are what make it so difficult. Trust your levels, follow price, and don’t predict.