Day Traders MUST do This (My Top Down Analysis Strategy)

if you are a day trader and you are not

doing top- down analysis you are leaving

money on the table let me explain top

down analysis is great for many reasons

it gives you context on the overall

Market which builds your confidence and

increases the accuracy of the trades

that you take it makes trading less

stressful as a whole and it's going to

open doors to potentially massive trades

that you wouldn't have gotten if you

hadn't done top down analysis now I know

as a day trader you might think I don't

need to do it cuz I'm getting in and out

of the market quickly but trust me on

this if you bring top down analysis in

your day trading results are going to

get better miles better so in this video

I'm going to be putting together what

I've found to be the best approach to

topown analysis for day Traders and this

is from years of experience and helping

traders to make millions of dollars so

it's going to be broken down into two

sections we are going to have weekend

work and we are going to have daytoday

work the weekend work should take place

probably on a Saturday or a Sunday it's

not going to take a lot of time but this

is just stuff that you definitely don't

need to do every day it's timec

consuming and boring if you do that you

can actually just do this once and then

trade daytoday with the structure that I

give you so on the weekend work we are

looking to analyze the high time frames

with this we're going to develop

narratives and we're going to build

Clarity around what the market is doing

from a larger picture perspective with

all of this in mind we can then move on

to doing our day-to-day work which is

what we'll do for 10 to 15 minutes at

the start of each trading day to

actually execute setups inside of the

big picture narratives that we've built

in our week weekend work so day to-day

then we only need to analyze low time

frames we need to build trading ranges

to work within and we need to make our

actual executions take the trades that

we found through our analysis now the

weekend work is going to take place on

the weekly and the daily time frames the

day-to-day work is going to take place

on the hourly the 30 minute the 15minute

and the five now I'm not going to

include the one you can trade the 1

minute time frame if you really want to

but I think if you're watching this

video you're probably not profitable

with your day trading yet and the one

minute is probably the hardest time

frame to become profitable with so I'm

going to suggest you just stick to the

easier ones go as low as the five but I

would cut out the one for now if you're

not profitable yet there may be a reason

why and I know 1 minute is exciting but

it might not be the most profitable for

you right now so what we're going to do

is jump over to the charts right now I'm

going to run you through this top down

process from the weekly yes I know that

sounds crazy for day trading but just

trust me on this all the way through to

executing and managing a position and

I'll show you why this is just so good

let's go all right right so step number

one that kind of weekend work we want to

begin on the weekly time frame and our

goal on the weekly because we're day

trading is just to look at previous

weekly candles and build ranges and

narratives surrounding where the market

could potentially go now if we were

doing swing trading we may want to zoom

out on the weekly a bit and kind of work

out some of the areas of supply and

demand that we could be looking to buy

or sell from but there is only really

two things we want to consider from a

day trading perspective the first is

previous weekly candles so we're looking

at this week's price action right now

this is where we're trading if we look

at the previous weekly candle which

closed what we want to do here is try

and get an idea of the momentum and

who's in control between the buyers and

the sellers in the market now this

candle shows a massive bullish push okay

we're looking at this blue candle here

if we consider the price action that

this candle has printed and how this

relates to the battle between buyers and

sellers we can see that this is wiped

out 1 2 3 3 4 5 6 7 previous candles So

within just one week or 5 days of

trading we've erased seven previous

weeks of downward price action this

shows that buyers are very much in

control and by looking at this weekly

candle we understand that well the

following week if we still see this

significant amount of buying pressure is

likely to be bullish so the immediate

thing we get from the weekly chart is

just seeing how strong the buyers or

sellers are okay in this instance the

buyers are very strong so we can

consider going into the new week with a

bullish bias or an idea to go long or

buy the second thing we want to look at

is potential targets the way we do this

is by looking at efficiency in the

market so just to show you what that is

an efficient market is a market like the

diagram that I'm drawing up where every

time we create a supply Zone in price we

move away and then we pull back and we

retest that Supply Zone okay so this is

what an efficient range looks like now

an inefficient

is kind of like this push down where we

created a supply Zone which would be

just here at the top and then the market

pushed away but it didn't pull back yet

so the area that we create between where

price is now and where the next Supply

zone is that is the inefficiency now

this works the other way as well with

buys okay any open price range created

from an area of Supply or demand creates

an inefficiency these inefficiencies are

likely to be traded through and they're

also likely to create reactions when

they've been filled so if we have an

inefficient price range that can

potentially act as number one a magnet

for price and number two an area for the

market to react from so for example we

have a small inefficiency down into here

if the market was to pull back to here

we would expect to see the market then

push away so if we had an inefficiency

up here at the top meaning if we had an

open price range say there was a supply

Zone and then a sell off from there we

could consider that if the market was to

reach the area of Supply there it would

then reverse so we would expect to see

something like this however in this

instance we don't have inefficiency okay

we just have this huge Wick which is an

efficient price range there is none of

that imbalance that we've discussed now

when we have an efficient price range so

efficiency like this and a Target which

is just a massive Wick we have no real

reason underneath this level for the

market to reverse right so we could

anticipate that the market will continue

all the way up to this point and trade

over this point because at this point

there is no reason for the market to

reverse under this level okay there

we've built our buyers we have a massive

push of strength from buyers which gives

us a bullish idea we could expect that

if the buyers continue we are going to

see the market going up and we have no

inefficiency we have an efficient price

range with the high topped out here

which will act as a very clear Target

for the market which we could use for

high time frame biases now we don't

always need to hold our trades up

towards these massive targets right

because I know as day Traders you

probably only want to be holding trades

for a couple of hours not a couple of

weeks but it does open doors to

potentially maximizing profits on trades

which is something we're going to cover

very soon all right so now we would go

to the Daily time frame and once again

this is weekend work all we're looking

to do on the daily is once again just

realign make sure there is no

inefficiencies that we should be aware

of and then we want to just take a look

at the existing candle moves here we

have 1 2 3 3 4 5 6 7 eight consecutive

bullish candles this shows that buyers

are very much still in control we have

massive strength from buyers here and

that reason leads us to believe that we

should just look for opportunities to

continue trading bullish okay we just

want to move with momentum if momentum

is super strong then we can use our day

trades and our lower time frames to

execute positions in line with the

bigger picture narrative which is in

this instance exceptionally bullish so

nothing has really changed too much here

by looking at the daily the only other

thing we can see here is that we've

broken structure as well once again just

adding to the bullish narrative and what

we've done here if we carried this

workout on for example Sunday we would

now know for this week we are trading in

a very bullish market and our overall

idea should be if a day trade provides

opportunity to buy we should go with

that but if a day trade provides

opportunity to sell maybe we should

think about this before we get into it

because we have a hyper bullish Market

with a very clear bullish Target as well

so this big picture narrative gives us

the idea to buy not to sell okay now we

can move into the day-to-day work which

is what you'll be doing on those lower

time frames so now we've jumped down to

the one hour time frame we still have a

high time frame narrative Target up here

and now we can start to look at the more

close trading range now for day trades

we don't need to worry about these

massive imbalances being filled before

we start looking for buying

opportunities okay for a swing trading

perspective a trade would look something

like this if the market was to get into

here we would look to buy but there is

no guarantee unless structure shifts

that we are going to be getting all the

way down there and because we are only

looking for smaller movements so we are

simply looking to trade within

realistically one or two of these hourly

candles we don't need to go and wait for

those massive moves we can actually

trade more immediately inside of the

existing price action so what we want to

do on the 1 hour time frame is build

what I call a daily trading range this

is simply a price region that you are

going to be trading in for that day the

most simple way to build your daily

trading range is to consider the

existing swing point the existing leg of

price action so the most recent leg of

price action we bottomed out here and we

traded up all the way to here this is

around 4 hours of price action right 1 2

3 4 and this is going to provide us with

our daily trading range because we are

bullish on the market over all we know

we want to buy and now ideally our

opportunity would be to buy within here

targeting here this would be the general

idea we'd look for now sometimes daily

trading ranges could be extended a bit

further let's say we had an imbalanced

demand Zone somewhere around here well

then we could draw our daily trading

range a bit lower because it would then

in that instance make sense for the

market to trade lower and then still

continue trading higher but in this

example that we're looking at here we

have no imbalances right you can see as

we said in line with that theory of

efficient markets every time we create

demand we push away we pull back and we

retest and then we push away and we pull

back and we retest every one of these

candles is retested with a wick and

there are no open candle bodies all the

way down towards that point we discussed

for potential swing trades so because

this range is efficient this generally

means that all of the orders have been

filled and there is no reason for us to

go under this level we do have at this

point some small inefficiency or at

least we did just one moment minute ago

which would have been from around this

candle here up towards this Top This

pullback has started to fill the

inefficiency but this means that

basically the only point we need to

consider for our trades from an hourly

perspective would be this demand

therefore creating our daily trading

range between this low this high and our

general consensus in line with the high

time frame narrative will be buying

there and targeting there okay so now we

can go a little bit lower now the

30-minute time frame really doesn't tell

us anything more in this example it's a

good one to check to see if we can find

any opportunities from it but for this

one specifically we're going to just go

straight down to the 15minute time frame

so on the 15 minute here we have this

area of demand this could be a potential

good place for us to buy from if the

market came into it now there would be

two ways to approach a trade here we

could number one just use a buy limit

directly into the market from this level

we would probably want to keep the swing

low covered in this instance though and

then if we were to set our Target at the

high we're looking at only around a 2.5%

return which is okay but we ideally

would want to get more I like to go for

minimum 3 R meaning I can win one in

three trades essentially and still be

profitable there okay so I want to make

sure that I can get this above 3% which

means I'm going to do one of the biggest

things about day trading and refine a

little bit to see if we can find the

best possible entry for this position so

going down to the 5 minute we can see

this demand Zone could be refined

towards this candle here but we also see

something very interesting here as well

and that is that we've got a demand Zone

just down here in the low now an

interesting thing about this demand Zone

we have our top of demand here and we

see there is still a very small

inefficiency into this level so what we

could expect to see is even though the

inefficiency is very small the market

can come in and retest that level and it

likely will if we take a look at the

origin of this demand Zone we had a

demand Zone and then we had a pushup

here which has broken some structure

this push-up breaking structure tells us

that the demand Zone we're focused on

this one has created a lot of demand and

we've seen a lot of buying coming into

the market from this level now if this

is an area that major buying has taken

place previously and it hasn't been

filled yet we can essentially see this

very simple logic if this is a discount

price that people are happy to buy from

in Mass it's probably going to be a

discount price that people will be happy

to buy from in Mass again if the market

gets into it all right so our trade

opportunity now could look like this a

nice refined example where you could buy

limit it if you wanted to and that would

be a very highrisk reward trade but what

we're going to do is something a bit

more similar to what I would do here and

we're going to look at a more

confirmation focused approach so now

that we're down here on the 5 minute

ideally what we would want to see is the

market coming down down into this level

retest it and then start to break

structure to the upside why do we wait

for this well the reason I wait for this

is because it creates that high accuracy

if we think back to our high time frame

narrative and every step we've taken in

this analysis Journey so far we built a

bullish bias on the very high time

frames we've then built this bullish

bias on this lower time frame now we

want this very lowest time frame the

execution time frame to also align with

our bullish bias okay so we want to make

sure that the 5 minute is bullish in

line with every other time frame that is

also very bullish so we wait for the

market to come into this level as we can

see it has done just that and now the

real structural point for this piece of

price action would be this High here so

if the market was to close Above This

level we could buy we could have our

stops in the range at a safe level and

then we can take this Market all the way

up to the high okay so let's jump this

forward a little bit here we see the

Market's pushed up and cre created a

closure above that previous Wick so

we're just going to line that up there's

our closure now what we could

realistically do would be use the demand

Zone beneath just here to enter a trade

and we can put our stop likely under the

swing low with a better risk reward at

this point so we can buy here we can

have our stops under the low our targets

up into the high and now we're looking

at a

4.17% potential trade right so this

alone this setup up you could have

potentially found something like this

without the high time frame analysis

however the risk you run by doing that

is because you don't have much context

you may have seen that the market

reversed sharply from here so your

immediate Instinct may be to start

selling you may say okay with this push

down we broken multiple points of

structure in this move so if we pull

back up we will look to sell the market

lower the problem with viewing things

from such a low time frame perspective

there is that when you incorporate the

high time frame narrative that we've

looked at it becomes is completely

obvious that this is the wrong thing to

do and it's the fact that we've done

that High Time FR analysis that we have

the clarity and understanding around

what the market is actually doing that's

what's going to give us the confidence

to take this trade and that's what's

allowed us to actually find this great

position so now we're going to look at

actually executing this position and the

way that we're going to do it is we are

going to open it in two sections the

reason we're going to do this is because

I want to show you how you can profit

maximize using top down analysis so my

usual risk for a position is going to be

1% what we're going to do is open two

trades at

0.5% and leave one of them running so we

are going to use by limit orders to get

into these trades okay that means if the

market comes down to that level we will

be tagged into the position we're going

to open the second one as well which is

going to be another 0.5% risk so now

we're risking 1% but what we're going to

do is draw one of the takeprofit levels

all the way up to that High Time time

frame narrative Target which is all the

way up here this is a massive risk

reward so realistically we've got a day

trade with a 4% potential return but we

can if we want to optionally swing trade

this into something that could get a

massive return now I know if you are a

day trader you're probably not going to

hold trades for that long but even if it

got a little bit further you're locking

in a bigger profit and because we have

that understanding that the market is

likely to go higher why not hold some to

maximize the profits that we can make on

this move so now with this said and done

let's just allow this trade to play out

and you will see the process coming

together we have the high time frame

which built our initial bias and

narrative for this market and now we're

moving into this lower time frame and as

you can see we've reacted from demand

and we've started to push up and the

market very quickly trades through

towards that first Target okay now

you're going to see the beauty as well

the first trade is now closed and we

have realized a profit of 2% okay

because we had a 4% trade and we've

closed half we have an unrealized profit

of another around 2% but what we can

actually do with this one is hold it and

move it even further into profit which

actually comes from the fact that we did

that high time frame analysis and

understood that the market is likely to

go

higher and now I've moved over to

trading view because that trade cut me

off the back test ended but we can see

in real time now at the time of

recording this that if we'd held this

trade past the initial Target of around

4% which would have been the uh first

overall Target if we'd have held a

portion of that position out it would

now in real time be trading at 11.5 R

which at half% risk is going to be

around 6% okay so you can see that just

by having that high time frame narrative

which was to Target the 1.71 800 level

we actually managed to massively

maximize the profits taken on this trade

we took around 2% profit there and we'd

be running a further 6% profit here so

we've turned a 4% trade into an 8% trade

overall just by having that high time

frame narrative and as I said you may

not want to hold trades all the way

maybe you still want to get out within

the day but even if you did you could

have got out up here or even up here and

added 1 or 2% to the profits that you'd

have made on the move to quickly recap

the process we are going to begin on the

weekly and daily time frames and here

all we're trying to do is build a

narrative we're going to find High time

frame directions targets and momentum

using the weekly and the daily when

we've done that we're going to go day by

day to the hourly and 30 minute where we

build our trading ranges for the day so

the upper boundary and lower boundary of

where our trades are likely to take

place this day then we build our

narratives inside of there to find our

actual entry zones and the best place

for stop losses we then go to the 15 and

5 minute to kind of ref find all of that

find our Target our entry our stop

positioning and actually execute the

positions that we've crafted through

this top down flow and the weekly daily

work should be done on the weekend

whereas the hourly down to the 5 minute

should be done day by day so this way

you can get all of the benefit of the

high time frame work without having to

make it super time consuming and

spending every day doing weekly analysis

for pretty much no reason now the next

thing you need to do is go over to the

top Link in the description and join

seven steps to profitable trades in here

I show you how to build your first very

own trading system so we're going to go

through the process of building a

strategy and a trading plan that you can

use to consistently take money from the

markets and what you can do is weave

everything we've covered today into a

personalized system that works for you

so it's 100% free you can sign up using

the top Link in the description I highly

recommend it thousands of people been

through it and I've heard nothing but

good things but if you don't want to do

that check out the video that's on the

screen somewhere here now that one's

going to be beneficial for you as well

so thanks for watching and I'll see you

in that video or in the free course