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One of the main reasons why 99% of traders are not successful in the markets is not because they don't know how to have the right entry or because they don't know how to have the right supply and demand zone or support or
Learn the best top-down analysis strategy for Forex trading in 2026 to identify market direction and make precise entries.
Key Takeaways
- Top-down analysis is essential for understanding market direction and improving trade success.
- Higher time frames (weekly, daily, 4-hour) should guide trading decisions over lower time frames.
- All traders, regardless of style, benefit from applying top-down analysis.
- Proper analysis leads to precise entries and better risk-reward management.
- Ignoring market structure on higher time frames often results in poor trade timing and losses.
Summary
- Most traders fail because they don't know how to properly read the markets using top-down analysis.
- Top-down analysis helps determine the overall market direction, crucial for making profitable trades.
- The strategy applies to all types of traders: scalpers, day traders, swing traders, institutional traders, and investors.
- The video explains the importance of analyzing multiple time frames starting from the weekly down to the 15-minute chart.
- Weekly time frame is the foundation, daily is the structure, 4-hour is the concrete filling, and lower time frames represent the building's interior.
- Higher time frames carry more weight and reliability than lower time frames due to longer formation periods.
- Top-down analysis involves checking if the market is bullish or bearish across all relevant time frames to get an overall market bias.
- The method prevents entering trades at wrong areas and helps achieve sniper entries with a profitable risk-reward ratio.
- The analogy of building a structure is used to emphasize the importance of a strong foundation in market analysis.
- The video uses TradingView charts to demonstrate the practical application of this top-down approach.
Full Transcript — Download SRT & Markdown
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[music] resistance. The simple truth on why 99% of traders fail is because they don't know how to read the markets.
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They simply fail on how to do a proper top-down analysis. The top-down analysis will lead you to understand where the direction of the market is. That's exactly what I'm going to be teaching [music] you in this video here today.
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Now, the importance of understanding top-down analysis is so you get these precise sniper entries and stop losing on these unnecessary trades trying to pick tops or bottoms. Having proper top-down analysis will get you those sniper entries and a profitable risk-reward
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strategy so you end up being a profitable trader in the markets. With that being said, let's begin. So before we actually get into the charts, I need you to understand why top-down analysis is a non-negotiable in trading. Doesn't
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matter if you're a scalper, you're a trader, if you're a swing trader, institutional trader, investor, doesn't matter. The most important thing is understanding what direction the market is headed. Is the market headed up or is the market headed down? That way you can
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make the decision if you want to buy with the market or if you want to sell with the market. People sometimes just look at the market and want to enter a short-term buy or short-term sell without understanding where the overall
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movement of the market is going. And that's a big mistake because you might be right on the direction of the trade, but it might be at the wrong area because of top-down analysis. Once you understand where the majority of the
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time [music] frames are headed, you can then go back on your analysis and determine if it makes sense to continue to buy or to continue to sell depending on what the time frames are telling you.
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This has nothing to do with any strategy. Once again, it doesn't matter if you're a scalper, if you're a day trader, swing trader. [music] Understanding top-down analysis applies the same to everybody. [music] And the best analogy that I can put to this is
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almost as if you're driving on a highway. Doesn't matter if you're on a motorcycle. Doesn't matter if you're in a car, in a truck. At the end of the day, you have to follow the same rules.
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You have to abide by the speed limits. You have to stop at stop signs. You have to use your turning signal to change lanes. You're just using different vehicles to get to your destination, but you need to follow the rules on how to
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get there. Same exact thing when it comes to trading the markets. You need to understand what the time frames are telling you. And once you understand what the time frames are telling you, you can make your decision if you want
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to enter that on a scalp, on a day trade, or a swing trade. But the most important thing is understanding those rules and then you can do whatever you want after that. Now, understanding that top-down analysis is a non-negotiable.
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Let's break down the time frames that are actually important and that we're going to be using in this video so you guys can understand where the direction of the market is headed so you can make your decision if you want to buy or sell
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with the market. So coming here to our trusty TradingView. I'm going to break this down in four very simple time frames. The first one is going to be the weekly time frame. Weekly time frame is going to be, think about it as the
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foundation of a building. It's the base of it. It's what holds the building up.
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If you have a strong base, you can build a higher building. The weaker the base, not as tall of a building that you can build. Next, when it comes to the daily time frame, think about the daily time
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frame as the actual structure of the building. So you can have a strong foundation, but the building could be built out of concrete, could be built out of wood, could be built out of drywall if you would like, could be
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built out of bamboo sticks, but the daily time frame is the actual cement block. So it's a strong building because you want to make sure you have a strong foundation and strong walls to hold then the roof and so on and so forth. So next
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we have the daily and then you have the 4 hour. So after the daily comes right behind it, the 4 hour. And think about the 4-hour almost as the type of concrete that you fill these cement blocks with.
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You know that once you place a cement block, you need to fill it with concrete so it can stay firm. Well, this is the best type of cement that you can fill it with. You can put the cheaper one, but
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it won't be as strong to hold these cement blocks together on the strong foundation. And then after that, you pretty much have the lower time frames.
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Now the lower time frames are considered the two hour, the one hour, the 30 minute, and the 15 minutes. Anything below is not a strong lower time frame. Now think about the lower time frames almost as the insides of the building. The
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insides of the building, you can get as creative as you want really. You can make the insides bamboo sticks. You can make them curtains. You can make them nice wallings. You can make them artificial rock, real rock, marble,
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lights, doesn't matter. You can get as creative as you want inside. As long as you have a very strong base that holds up the building, that the walls are strong enough to do whatever you want inside. So, as long as the weekly, the
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daily, and the 4 hour are leading you to understand where the markets are headed, whether it's up or down, what the lower time frames are doing [music] doesn't really matter. The lower time frames could be telling you one thing, but if
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the higher time frames are telling you another, you go based off of the higher time frames. The higher time frames are much stronger because they take a lot more time to actually make the market structure. It takes 7 days for one
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weekly candlestick to form. That's going to be a lot stronger than a candlestick that takes 15 minutes to be created. If it creates a total of two months on the weekly time frame to create a bullish market structure, I'm going to respect
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that a lot more. If it takes one hour on the 15 minute time frame for it to create a bullish market structure, it's just simple logic and it's simply how it works. Now that you understand the importance of the different time frames
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when it comes to the weekly, the daily, and the 4 hour and then the lower time frames. What does top-down analysis actually mean? Because the analogy that I just gave you was pretty much the opposite. We started from the bottom up.
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Build the foundation of a building and then we worked our way up. Well, that was just so you would understand the importance of each time frame. But top-down analysis is exactly what it means in the name top-down analysis. We will
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start from the top all the way down. So we will start, we will start from the weekly time frame. Then we will work our way down to the daily. Then from the daily we'll go to the 4 hour, 4 hour, 2
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hour, 2 hour, 1 hour, 30 minute, 15 minute all the way down our lowest time frame which will be the 15 minute. Now what top-down analysis actually is and how top-down analysis actually works is we will find if this market is bullish
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or bearish on the weekly, find if it's bullish or bearish on the daily, bullish or bearish on the 4 hour all the way down to the lowest time frame and then we will have an overall score at the end
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of our analysis to determine where the majority of the time frames are going. All we're doing when it comes to top-down analysis is literally just zooming into price in different time frames. For example, here this one single
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candlestick that you are seeing right here that I will box off. This one single candlestick took a total of 7 days to be created on the weekly time frame. When we go down to the daily time frame, you'r
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same exact candlestick is built up of a total of five candlesticks. 1 2 3 4 5.
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Now, these five candlesticks, if we go down to the 4 hour, will be broken down in tens of these different candlesticks that make up those five days. All of these 4hour candlesticks when we go down to the 2hour will be built up of these
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2-hour candlesticks, the 1 hour, the 30 minute. We're looking at the exact same market structure, the exact same price from the highest time frame, just broken down into details on every single time frame. And there's unique and different
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market structure in every single one of these time frames. And that market structure is what the top down analysis is. We're going to read that market structure, which is reading the candlesticks and reading what the price is telling us to determine where the
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overall time frames are going. But we're looking at the exact same market just zoomed in a little bit more every single time to determine where this market is headed. Now, top down analysis is once again just to determine if something is
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up or down, bullish or bearish. And that is done by this reading of the market structure. What is market structure?
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Well, this right here is literally market structure. So, let me go ahead and just show you this line chart. This is market structure. Market structure is what is right in front of you. It's these highs and low points that almost
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looks like a heartbeat but going up or down, right? Heartbeats go sideways. This market structure goes up or it can go down. This is an bullish example.
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This is obviously in a bearish example. So this market structure is being created by the actual market itself.
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This is think about the best way that I can think about this. It's almost like the heartbeat of the market. Now the market has a never-ending heartbeat and [music] it could be very strong to one side or very strong to the other side.
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But this is the trail that it leaves. So for example, when you go to the hospital for them to read your heart rate to see if you have a high blood pressure or low blood pressure, they're going to see
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your heart rate, see how fast or how slow it's moving. That will be to determine if you're about to have a heart attack or not. This is for us to determine if the market is going to be going up or down. This is the heartbeat
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of the market and this is how it represents it. Now, there's many different types of ways on how to read this market structure and there's many different [music] types of candlesticks, but the ones that we use are the
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Japanese candlesticks. Now, these candlesticks leave [music] market structure points behind. They leave highs and low points. So once you have a bullish market, a bullish market is created of higher highs and higher lows.
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So this is obviously short for higher highs and then higher lows. This is an abbreviation for a bullish market. Now a bearish market is basically the same just opposite. So a bearish market is consisted of lower high and lower low.
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Right here we would have our lower high and [music] lower low. Now what is a lower high and what is a lower low? Everything is exactly what it is. Trading is pretty self-explanatory. It what the word means is exactly what it is. There's no secret
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meaning [music] behind it. So a bullish market. So in this market this would be considered the higher high and then this would be considered the higher low. Now once again this is the most important thing because this will lead us to
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understand where this market is overall headed. Is this market bullish or is this market bearish? So this right here is going to be the higher high and this right here is going to be the higher low. That's the highest high. That is
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the highest low. Don't get them confused in between higher low and lower high. They're two completely [music] different things. Higher highs and higher lows is when the market is bullish. Lower highs and lower lows is when the market is
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bearish. [music] They both have very very different meanings. They do not go one in another. You can't have a higher high and a lower high or vice versa. A bullish market is only consisted of these two. A bearish market is only
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consisted of these two. Now, the moment the market has some type of retracement like this, this is simply just market structure. It has not broken above the previous high and it has not broken below the higher low. So, if this breaks
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above the previous high, well, if this breaks above the high, guess what? we have a new high. Think about it almost as a heartbeat in the monitor. And if your heartbeat in the monitor has been created, let's say, I don't know, 80,
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right? I'm not sure how blood pressure works or something like that. I'm not that educated in that, but let's say your heartbeat is 80. The moment it goes to 90, it will obviously have a bigger spike and then your spikes will be
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bigger. That means your blood pressure has risen. That's exactly what this market is doing, but in obviously the market format. So, you can't say that your blood pressure is now at 80. It's now at 90 and that is going to be the
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new base where they're going to be able to determine if you're about to have a heart attack or not. This is the exact same thing. This market is now at this new high point. This the new high point.
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So once the market has broken that, you need to make that the new higher high.
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And if you have a new higher high, you must have a new higher low. I'm saying a bunch of different notes that you should be writing down at this very moment. So write these notes down. I just don't
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want to fill up my chart with a bunch of different [music] text, but this is very important. Once you have a new higher high, you must have a new higher low. So the higher low simply follows the previous structure point, you would just
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move this up. That's the new higher low. So go back going back to the heartbeat.
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If you were at 80 and now it goes to 90, your new base moves up to that 90, wherever that 90 point is. So this is the new higher high. This is the new higher low. And once again, if market
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has some type of retracement and it has any type of movement in here, [music] it doesn't matter. your heartbeat is currently still 90 once the market for whatever reason if it breaks above 90 once again now let's say it goes to 100
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about to have a heart attack or maybe not I don't even know if I'm saying the proper numbers but should make sense with this analogy now this once again becomes the new base this is the new high and then this will be the new
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higher low so if as long as the market stays in between your high and your low you're within the safe spot or you're still [music] within this bullish market. The moment this market decides to break below, now guess what? Now this
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market shifts from bullish to bearish. So if your heartbeat was at 100 and it breaks back below 90, well that means that now your blood pressure is coming down. You're [music] safer. So this is exactly what would change this market.
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Now this market would go from being bullish to being bearish. So once it breaks above below the higher low, this market becomes the new lower low. Now once you have a new lower low, you must have a new lower high. Your lower high
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goes to literally the last lower high, which would be following price to this point. So you would follow your lower high to this point right here. And now that would become your lower high. Same exact thing. Once again, as long as the
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market is inside of the lower high and lower low, you are safe. You have the exact same blood pressure. You have the exact same trend. The market right now is just creating market structure within the lower high and the lower low.
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Nothing has [music] changed at all. Now, if this market breaks below the lower low, same exact thing. Now, you were at 90. Now, you broke below, you're at 80.
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So, it means your blood pressure is coming down. So now you have a new base.
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So this becomes the new lower low. This last low lower high point becomes the new lower high. Every single time, write this down. Every single time you break a lower low, you get a new lower high.
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Every single time you break a new higher high, you must have a new higher low.
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Whenever you have a new high point, you have a new higher low point. It always adjusts, right? So for example, here this market is still continuously bearish. That's the lower high. This is the lower low. And as of right now, your
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blood pressure is getting better. [music] But now, for whatever reason, you're stressed. And boom, guess what happens here? You broke above your lower high. Now, making this market back to bullish once again. So now your blood pressure is back at 90. So what you
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would do here is you would identify this new high point as the new higher high point. So this right here is going to be higher high. And based off of what I just said, once you have a new higher
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high point, you must have a new higher low point. So your higher low is now going to get adjusted to the next higher low, which is the previous structure point. That's right here. So this right here is going to be your next higher
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low. So now you understand how this market, you can look at this market and if I didn't have these highs and lows pointed, maybe you would call this market bearish or maybe you would call it [music] consolidating or maybe you
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would call it bullish. But you might not have the full understanding of where exactly it's bullish from. And that's a big mistake a lot of traders make because [music] yes, they could be wrong or they could even be right about it
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being bullish, but they're wrong about where it's bullish from. And that completely changes [music] their whole entry point. Changes their whole risk-to-reward point, their take-profit, their stop-loss, their trade management.
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All because they don't have the foundation set correctly of where this [music] market is bullish from. Now, again, doesn't matter what type of trader you are. Doesn't matter if you're a scalper, a day trader, swing trader.
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This is how you read market structure. This is how you identify if something is bullish or bearish. Notice how I'm not talking about a strategy. I'm not talking about a concept. I'm not talking about an approach to the markets, a
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plan, nothing. I'm talking about how to read market structure. Best analogy that I can explain is this is the ABCs to the English language. I'm literally explaining to you the ABCs. Some people don't even know the basic ABCs. Now,
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what type of accent you want to speak the ABCs as with whatever accent you want, that's entirely up to you. But doesn't matter if you have a British accent. Doesn't matter if you have an American accent. Doesn't matter if you
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have a Canadian accent. You're using the same letters to speak the same words. Doesn't matter what type of strategy you use. You use the same exact market structure to determine whether you want to buy or sell a market. Some people
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just have this concept entirely wrong. Think about it almost as if they're putting their own letters in the ABCs.
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Doesn't make any sense. Now, understanding how highs and lows works on the line chart, it's no different on the actual candlestick chart. Just it's not going to be as clear as the line chart. Well, because we're going to be
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trading candlesticks. Candlesticks create wicks. They create big candlesticks, small candlesticks, a bunch of different variations. All a line chart creates is a line chart. Now, if it was really that easy, everybody would trade the line chart. But the line
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chart doesn't give you entry signals. It doesn't give you rejections. doesn't give you anything other than the overall movement. So, we use the line chart to learn how to read market structure, but we identify the highs and lows based off
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of the candlesticks. So, we actually can do it based off of what the candlesticks are representing us. Now, a lot of people make a common mistake, for example, and they can put the highs and lows to the wicks. [music]
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Now, this is where things start getting a little bit more detailed to the type of strategy that someone uses. Think about it as a type of accent that someone speaks with. I have a very interesting American, Latin, Spanish,
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Cuban, Miami accents. Very different from the rest of America and the rest of the English speakaking native language.
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So think about that almost as how you place these [music] highs and lows. There's no difference, right? So for example, if I were just to take this market really fast back to the line chart, as you can tell here on the line
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chart, technically the high and the low points would be right here. That would be the higher high point. And then the higher low point would be this point right here. Right? Just for argument sake to keep things simple. [music] That
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would be the higher high and the and the higher low point based off of what I educated you. This right here is the ABCs [music] in the market. Now, this is where things start going into the accent that one can speak. Do you put it at the
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bodies or do you put it at the wicks? Now, many people like to put it at the wicks. Other people like to put it at the bodies. I like to keep my market structure approach to the market as
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close as I can to how it is on the line chart. If the [music] ABCs mean one thing, I'm going to be as close as I can to that. I don't want to get creative. I don't want to create my own slang at
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all. Not with trading because I'm surrounding my decisions around money and I want to make sure that it's as safe as possible. I don't want to get custom [music] with my decisions around money. I want to have high probability
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of making money, not losing money. So, I base my highs and lows to the bodies of the candlesticks. If you notice [music] here, to the bodies of the candlesticks.
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A little hack that people do at all times is they always go to the line chart. They go here and they just place the lines on the structure points that the line chart represents to them. And then what they do is they just go back
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to the candlestick charts how I'm doing right here. And then at that point, they are able to have it straight at the candlestick closure, which is the market structure. So, that's a little hack that you can do or you can just directly do
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what I do and just place it at the bodies of the candle. So, for this example, on the daily time frame, technically we're bullish. This is the high, this is the higher low. This is the higher high. On the weekly time
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frame, if you were [music] to just take a quick pause, pause this video and I want you to tell me, is this market structure bullish or bearish? I want you to tell me if this market is bullish or
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if this market is bearish. Take your time. Go ahead. Now, if you said that this market was bullish, you're right.
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If you said that this market was bearish, you're wrong. Now, I want to make sure that you know exactly why you said that this market is bullish. This market is bullish because of this higher low here and this higher high right
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here. As you can tell, this market once upon a time was creating lows and highs.
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This market was creating lower low, lower high, lower low. And then this market has now shifted and has created a higher high and a higher low. And as you can tell, I'm placing it at the body of that candlestick, not at the wick. Once
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again, if we go to the line chart, once we're at the line chart, you can tell how it would place it at that high. This is the higher low. That is the current higher high. See how this market went
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from bearish lower highs and lower lows to then shifting and now creating highs. Now this market we understand that based off of the weekly time frame. So we have weekly is bullish and then the daily is also bullish. Now this is great. This is
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giving us a strong base and a strong foundation to understand where the majority of the time frames are headed.
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Now what's the 4hour doing? Well, let's go and find out now the 4 hour at this given point. Once again, let's run the same exercise. I want you to tell me if this market is bullish or if this market
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is bearish. Pause the video and go ahead and tell me. Now, coming back to it, is this market bullish or bearish. Well, if you said that this market was bullish, you are correct. If you said that this market was bearish, you are incorrect.
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Now, once again, we could do a very quick little hack. Go to the line chart.
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And on the line chart, you can tell that this was creating highs and lows all throughout here. Higher, high, higher low. This ended up becoming the market the market's highest point to this point right there. And then this ended up
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becoming the market higher low. If that is the higher high, we have to work our way backwards to find the higher low.
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This is another side note. Is impossible to have the higher low in front of the higher high. It is impossible to have the lower high in front of the lower low. Now what do I mean by in front? The
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higher high is always in front. Also write that down. The lower low is always in front because that is what's leading the market. What's leading the market is what's in front. This is clearly the front of the market. The higher high is
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always in front. Some people I don't know how they put the higher low in the future. So they they would they will determine this as the higher high, but they'll put a higher low on some random price that they see here because they
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don't know how to identify it. So some people could identify this as the higher high, but they'll place the higher low as this structure point right here, for example. They'll place it to this current price. Now, they're wrong. The
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higher low could never be in the future. Could never be in front of the higher high. The higher low is something that the market left as a trail, and we're identifying it as the last higher low.
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So this is very important and very key because some people get confused when they identify the higher high here. They look for the higher low in front. The higher low is never in front. It's always behind it. So this would be the
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higher low. Now this market is still bullish as you can tell. We have not body candlestick closed below the higher low. Now if we go back out to the candlestick chart, we can very clearly see that as well. That is the higher low
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and that is the higher high. This market is still very much bullish. So now we have the 4our bullish. So now based off of our top down analysis, we [music] have three of the highest time frames going to the upside. Now some people
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somehow have a strategy or the audacity to say, "Okay, you know what? It's a good time to predict the top. We're going to sell." Now they might get lucky once, twice, maybe three times, but there's no longevity in that. What makes
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the most sense now is to find the right area on where to buy. And I have more of these videos on my channel on how to find these areas and how to actually enter. You want to know more about that?
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First of all, hit that subscribe button at this point because I'm sure you've learned a lot. And this is only our first video, our first tutorial of 2026.
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If you're seeing this in 2026 or 2027, I'm sure we have many other videos to educate you on how to properly find these market structure points and much more. So, hit that subscribe button, check out our other videos. But with
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that being said, this is currently identifying a bullish market with a basic top-down analysis going from the weekly, daily to then the 4 hour. Now, technically the next step would be to go to the 2h hour, 1 hour, 30 minute, and
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15-inut and replicate the exact same thing that we've done, but I actually pause right here. Now, the reason why I pause right here after the 4 hour is because I use the lower time frames more for the entry point. And you know what?
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I'm going to actually teach you in this video how to actually enter with the right top down analysis as well. I'm going to make sure you have the full understanding how to properly do a top down analysis. So to do a proper top
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down analysis and find the entry point. The correct thing to do now is find an area on where you want to enter. [music] You can't just enter based off of the overall trend. If everything's going up doesn't mean that you [music] could just
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buy. So right now, yes, we have the weekly bullish, daily bullish, and the 4hour bullish. That doesn't mean that we could just go ahead and buy. we need to find the right area on where we should buy. So this is where we would go back
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up to the weekly time frame. We hit a big reset. So our big reset moment [music] is to identify where is our entry point in this market. Now this is once again a very big mistake [music] that 99% of traders make in the market.
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Again, as of right now, I'm not even talking about strategy. I'm not even talking about concepts, scalping, day trading. To me, that is completely irrelevant right now. I'm teaching you how to word these letters that you have just learned because these are these
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might be brand new letters to you or you might be a little bit experienced [music] and learning the English language in this case the trading language. And I'm just piecing everything together for you. So now we need to find an area on
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where we should enter this trade. And it doesn't matter what type of strategy you take or what type of strategy you use.
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This is how it should be done. So the area of interest should only be found inside of the high and the low. Inside of the higher high, inside of the higher low. You find the area of interest within this structure point. Because if
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you have an area of interest below the higher low, once price gets to this area, guess what? Now we're bearish.
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This market goes from higher low to now lower low. This will become bearish. So you can't buy a market that is going down. That is what [music] the mistake that 99% of traders make. They simply say, "Yeah, you know what? This is a
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great support. We'll buy here." Now, yes, you might be right. That is a great support level, but you're actually buying when the market gets bearish to that point, which simply makes no sense.
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So, no, you cannot place an area of interest wherever you'd like. I mean, you could, but you're just setting yourself up for failure. So, this is where you would find your area of interest within the high and the low. So
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you would find an area that has a decent amount of rejections. For example, like this point right here. This has rejection rejection rejection rejection. We can expect for price to have a retracement into this area to then head to the upside. So we find an
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area of interest on the weekly time frame. There's only two time frames where you can find an area of interest on the weekly and the daily. Now on the daily time frame, we would do the exact same thing. We [music] would go based
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off of our higher low and then we would go based off of our higher high. I think we called this our higher low. So once again, we would go here, go to our high point, go to our higher low point, and
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then we would go and work our way down and find an area that has many touches.
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For the most part, sometimes they overlap, sometimes they don't. And then, excuse me, we're left with a very big zone. I'll just do it over again.
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Sometimes they overlap, sometimes they don't. And for the most part, they do. When they do, you just have one big solid zone. For example, here the weekly and the daily have a very clean zone in here. So, what I like to do is mark this
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area off as a weekly and a daily area of interest. So, now I know that this is two areas of interest strong. As you can tell, I have it over here to the left hand side. Let's actually bring it to
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the top hand side. Let's make [music] it a little bit bigger. There you go. So, it's very easy to identify. So, let's put that at 14. So, we know that this is a weekly and daily area [music] of interest. So what we're
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waiting for is for price to have a retracement into this area to then buy.
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Now we have to wait and play the waiting game. Patience. Now we might also understand that for the market to have the retracement into this area of interest. Guess what's going to happen to the 4 hour. The 4 hour right now this
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is the higher low. This is the higher high for the 4 hour. Once the 4 hour makes it into this area it's going to most likely be bearish to make it into here. Now our job is to make a decision
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either one wait for this market to shift bullish so we can trade with the trend or do we take the risk when the market is bearish. Now at that point that's where strategy starts to come in [music] and where honestly trader preference.
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Are you more of a trader with a high risk appetite or are you not? And this is where once price is at this area of interest is when you would enter the trade whether you want to wait for the 4
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hour to be in your favor or not. But this is where I would then wait for my rejection candlesticks which can consist of multiple dogees or an engulfing candlestick which will be my entry signal. This entry signal can happen on
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the lower time frame, higher time frames. Obviously the higher the stronger. But the most [music] important thing of top down analysis is understanding where the market is, where the market is headed and why. Because some people might see that the market on
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the 4hour is bearish and they won't understand why. Well, the market went bearish because it's creating that retracement to this daily area of interest and to [music] that weekly area of interest. Somebody has to go bearish for that to have that type of
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retracement. The simplest analogy is if it's raining outside and somebody needs to go out to the car to get the food so we can cook the food is somebody's going to have to go get wet to bring the food
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in so we can eat. The market is going to have to go bearish so it can have the retracement to then continue going to the upside. It's part of the game. You just need to understand that it's okay
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for it to be bearish and not to think that the market is good to sell at that point because you're going to be basically jumping into a two-ft pool.
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You're basically running right into support. And when you're above support, you buy. When you're below resistance, you sell. So in this point, once price comes here, you would wait for your entry signal to then buy. So to sum
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everything up, top down analysis is a non-negotiable. Doesn't matter what type of trader you are, you need top down analysis. And it's in this video you're able to understand the highs and lows of the market which will lead you to
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determine if the market is going up or down. That's what top down analysis is meant to do to understand where the market is headed and why and where most importantly. Now after you identify these highs and lows, you need that area
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to actually enter the trade with your entry signal. And this is what I do every single Sunday with my students. I share with them the top markets that have the highest probability of going in one direction versus the other. What's
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the exact area that the trade should have the reaction from? and where they should enter from. And then I review their trades when they take these trades. I personally get on a call with my students and I tell them, "Hey, you
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did this wrong. You should do this this next time or you did this right. Double down on this." Now, this is a private community that I have where I break down my top trades every single week. You're part of a private winning community and
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you get to get on a call with me and ask me any questions that you would like.
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You want to know more about this, hit the link in description down below because we're only accepting a couple of students at a week at a time because I want to make sure that I'm reviewing every single trader trades accurately to
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make sure that your top analysis, your areas of interest, and your entries are done accurately. Hope you guys enjoyed this video. Make sure to hit that like and subscribe button, and I'll see you guys in the next video.
Topics:top-down analysisforex tradingmarket directiontrading strategytime framesweekly chartdaily chart4-hour chartsniper entriesrisk-reward
