Long Term Top Down Analysis

Monthly To Weekly

The more things that we have in confluence supporting a specific idea or bias or
analysis view or perspective the better. Now obviously not everything is going to
be in alignment, but if we have a sampling of similar ideas overlapping r
converging with the same premise then we generally have a higher odds of the
outcome to be in our favor. I generally do this level of analysis once a month and
it is generally the close of the month that just ends.

This Is My Personal Approach

Focus Of This Presentation:
Determine the impact of the Monthly Perspective on an asset or market.
Identify the directional bias for the HTF Monthly chart.
Classify the PD Arrays accurately to assist in Key Levels.
Complete an Institutional Analysis on a Monthly basis.

It all starts here, Seasonal Tendencies. We would be looking at the current month's
Seasonal Tendencies or the upcoming month's Seasonal Tendencies. I already taught
what Seasonal Tendencies I like and how we interpret it. So, I do not need to go
into great detail. Everything we see in this teaching is synonymous across all
asset classes. As we get closer into the smaller timeframes there are a lot more
specific things that have to be done for respective asset classes in specific
markets. This one's a broad-brush concept where it covers every asset class, Bonds,
Stocks, Currencies and Commodities. Then the next thing I like to do is that I like
to refer to the Quarterly Shifts. So, I like to look at the analysis with the
anticipation of saying, it is either going to continue or likely reverse in the
coming three to four months. Next thing I do is that I look at the Interest Rate
Differentials. This is with Currencies, if we were looking at Stocks this would be
with the Bond market, if the Bond market is going lower than that means that
Interest Rates are going to be going higher, and it is going to be harder for
Stocks to maintain a Bullish market and if Bonds are rallying than that means that
Interest Rates are going lower and generally that is going to be supportive of a
Bull market in Stocks. Commodities everything is going to be reversed in terms of
the Interest Rates. Next thing I like to do is identify the Market Profile, are we
in a trend, consolidation or Reversal, Market Profile. Then we look at Intermarket
Analysis, markets that are positively and inversely correlated. Sometimes it will
negate a trade idea. That is why you want to refer to markets that are closely
correlated. Whether it would be positively correlated or negatively correlated.
Then we look at Market Structure, this is where we look at the market structure
itself, with the higher highs and lower lows, and the ideas like SMT Divergence and
Correlation ideas. Then I identify the PD Array Matrix, I identify the market in
terms of a Premium and Discount. Relative to the PD Array levels I will celibate
the levels and come out with key price levels as a result and those key price
levels are when the trade ideas are going to come to fruition. They could be either
in terms of an entry or they could be objectives or targets. By doing this step-by-
step process you are going to come up with a Monthly Bias. What I do is that I take
this information and transpose it to a Weekly Chart. We can help qualify and
confirm some things and that is based on inflationary and deflationary conditions
like I taught in January. The easiest way to look at Inflationary and Deflationary
conditions, when Commodities are going higher, we are in inflationary condition,
and when commodities are going lower, we are in a deflationary condition. When we
look at Quarterly Shifts, we want to be looking back at the last three months but
then potentially four months to see if there is something that I might be missing.
In terms of a long-term perspective, I want to be forecasting the next three months
movement from a long-term perspective. So, once we have all of this information, we
take it over to a Weekly Chart and we can start using that on the Weekly Timeframe
as well.

Where Do I Begin?
Start with the calendar month we are in or about to begin. Refer to the Seasonal
Tendencies taught in this program.
Not every market or asset class will have a Seasonal now.
I want to focus on the markets that - "historically" at that same time of year -
will likely move in similar fashion.
The Seasonals are specific and have been delivered for the four asset classes under
study these past 12 months. (I know there are certain times of the year where I
want to be doing certain trades, I do not force myself into that trade, but I look
for things like we just outlined from a step-by-step process from a Monthly
standpoint to justify why that Seasonal Tendencies might have an impact on price
this year.

Next I Determine The Next Shift:

I refer to the long term 9 - 18 month trend in the market.
If the direction is Bullish - I justify why the next Quarterly Shift might be a
Buying Opportunity.
If the direction is Bearish - I justify why the next Quarterly Shift might be a
Selling Opportunity.
I avoid trying to pick the end of the 9 – 18 month trend.
Long Term trends tend to remain in place for some time.
If the 9 - 18 month trend is not clear or consolidation – I will elect to
anticipate the direction of the previous 3-4 months direction to reverse. (I would
like to anticipate some measure of retracement or reversal for the upcoming month
or two).

I Refer To Global Interest Rates:

I use websites like Investing.com to locate and compare Central Bank Interest Rates
for Differential Trades. (It gives you the current rate, the upcoming meeting or
next meeting and the last change how much it changed).
https://www.investing.com/central-banks
I look for high rates to pair with a low rate country to form a Forex Pair to adopt
a "Fundamental" bias.
Ideally, both Seasonal Tendency and Quarterly Shift expectations are in alignment
with the Interest Rate Differential trade idea. It may not; all three should agree.
(It may not be like that but ideally, all three should agree).

I Define The Current Market Structure: Current Market Structure I classify recent
Highs and Lows.
I compare the relationship to the Highs to recent Highs to determine if a Long -
Intermediate - Short Term High is in control of Price presently. (I want to compare
them with positively and negatively correlated markets basically I am looking for
SMT Divergence. Then I compare the relationship of the high to the recent highs to
determine the long, intermediate term or short-term highs are in control of price
presently. In other words, are we making higher highs and then we recently made a
lower high and then maybe even a lower high after that probably means we have
probably made an intermediate-term or long-term high. If I see that relationship in
the highs and if it is at least implying that an intermediate term or a long term
high is formed then I am probably going to be looking for reasons to be looking to
go short, now ideally that is going to be in currencies that are weak currencies
paired against a strong currency during a time where I anticipate lower prices on a
Quarterly Shift at the same time that the Seasonal Tendencies are calling for the
currency to go lower or that market to go lower and the profile is trending. That
would be the ideal scenario. The reverse would be said if I am looking at the
relationship of the lows by comparing those highs we would hopefully see a SMT
Divergence from a correlated asset or against the dollar if it was foreign
currencies we would want to see a failed lower low with a higher high in the
currency we are looking to short or if we made a lower low in the Dollar and a
failed higher high in the Foreign Currency that would be a SMT Divergence and that
would also help us with Market Structure ideas. So, it is basically just looking
for SMT Divergence and looking for Market Structure to support another price leg
higher or another price leg lower).
I compare the relationship to the Lows to recent Lows to determine if a Long -
Intermediate - Short Term Low is in control of Price presently.
Trades selected in the direction of the current Market structure are going to be
favored in my analysis. (So, if I can see clear reasons why Market Structure should
be going higher and Seasonal Tendencies are suggesting that is in line as well then
obviously that is what I am looking to do and I am only going to focus on those
types of trades, I do not want to countertrade when I have these conditions, where
I have Market Structure, and SMT behind me and Seasonal Tendencies behind me and
again the Interest Rates).

Confirmation Seen In Other Markets?

If I have a Bullish Market Structure determined in my market of interest:
I look for Intermarket Analysis to support this idea in positively correlated
markets and opposed to it in negatively correlated markets. Example- Bullish Dollar
= Weak Gold Market Technically.
If I have a Bearish Market Structure determined in my market of interest:
I look for Intermarket Analysis to support this idea in positively correlated
markets and opposed to it in negatively correlated markets. Example- Bearish
Eurodollar = Strong Dollar Technically. (In times when there are wars and etc.
Something is driving Gold outside then normal so that may be a catalyst where Gold
will not be that supportive behind your trade because it is being driven by
something outside of normal. Which would be it is being treated as a safe haven).

What Profile Is The Market In?

Is the market under study - Consolidating?
If Yes - Expansions are likely to show evidence prior to breakout. If No - Trend
might be reaching an extreme - Retracement likely. (If it is not consolidating that
means it is trading so I would want to look and see if there is reasons to justify
why the trend has been in place, is it likely to hit stiff resistance because if it
is retracement's likely).
Is the market under study - Trending?
If Yes - Look for continuation trades - avoid the Top & Bottom picks. If No - Look
for signs to support a direction breakout - Intermarket. (If the answer is no, then
it is consolidating then so I look for signs for directional breakout and I am
going to be using Intermarket Analysis to do that).
Is the market under study - Retracing?
If Yes - Look for signs of continuation trades - post retracement. (That means I am
going to be anticipating that retracement to get down to specific price levels and
then looking for that continuation to the upside or downside relative to the
trend). If No - Determine if Consolidation or Trending - use above ideas.

I use these above ideas here to lead me to my next course of action or wait until
more information comes.

Locate The Institutional Focus Points

Once I arrive at a portion of Price Action I wish to analyze - I breakdown the
selected Price Range into Premium and Discount.
Not every Price Range will have every possible Premium and or Discount Arrays. I
just note the ones obvious in the Price range. Both the Premium and Discount
Arrays.
I will look to build potential trade ideas based on the PD Arrays and referring to
all the previous analysis points thus mentioned in this presentation.

Note The Key Price Levels:

Once I determine the portion of Market Structure I want to use for my trade ideas:
I round each PD Array to the nearest .10 level or 0 level or .5 level.
The Premium Arrays above Market Price are rounded down to the nearest adjusted
number. [Calibration].
The Discount Arrays below Market Price are rounded up to the nearest adjusted
number. [Calibration]. (Whichever gets me closest to the PD Array Matrix Discount
Array but does not have to be required to round up to it).

End With The Monthly Bias: After referring to:

The possibility of a Seasonal Tendency
Anticipation of a Quarterly Shift
Paired Strong to Weak Interest Rates - vice versa
Determined the current Market Profile
Confirmed my analysis with correlated markets
Selected a portion of Market Structure to frame a trade in Defined the PD Arrays to
arrive at Key Price Levels. (Looking for Internal Range Liquidity to execute on and
External Range Liquidity for objectives).
I will have arrived at a Directional Based Analysis on the Monthly Timeframe -
which gets transposed to the Weekly.

When there is a consolidation then a false break out above that high that could be
seen as a stop run raid, then we see price break down and go back to the middle of
that range, we should always refer back to price reaching the extreme of that
consolidation.

Just like that we have a potential Bullish scenario because June is a Seasonal
Tendency month when we should see Australian Dollar rally. We have had the lasts
three months go lower. So, a Quarterly Shift is in order it has been in a
retracement, what was it retracting down into? An Orderblock, seasonally expecting
higher prices and we are in a consolidation so, what is above the consolidation
during this market profile? Buy Stops. So, we are going to be targeting above the
range's highs in here. There are so many things that could have supported this
idea, we could have compared it with the S&P because Aussie tracks the S&P very
well.