 so what's the first thing that comes to your mind when you look at this chart you're seeing a high then you're seeing a low and you're seeing a lower high a lower low a lower high right so then you start connecting the dots and it's basically to down trend so obviously in your mind you're thinking this is a bearish chart then if you zoom out just a bit you can see that the actual overall trend is up and this is just a slight pullback in the overall trend a common question that I get asked all the time is what time frame do I use when I tell people that I use all time frames people are usually a little confused with that answer today I'm going to explain exactly what it is that I mean when I say that by introducing you guys to the top down analysis this is a very basic skill that you must incorporate into your trading habits to be able to see the big picture be a more consistent winning trader and be able to quickly look through charts identify supporting resistance zones identify trends and identify possible trade setups very very quickly so if you're looking to become a better trader this is a good place to start let's dive right in hey what's up j here and welcome to bitcoin daily bringing you guys the best tips tutorials and ideas to help you guys become profitable and successful traders the goal of this channel is to empower you guys with the resources and knowledge to help you get to that next level so make sure to subscribe hit that like button and turn on that bell notification so that you're notified as soon as we post the videos five times a week so what exactly is a top down analysis a top down analysis is used to refer to doing trend analysis on longer time frames before narrowing down to smaller time frames so if you look at this chart you can see this chart we're currently looking at the one month chart if we were to go to the let's say daily chart it looks completely different right so basically the whole idea here is to get a more comprehensive view of the price action by moving from wider time frames to smaller time frames when doing a technical analysis the first thing I always do is look at the daily weekly and monthly charts to determine the overall long-term trend and as well as identify more long-term support and resistance levels before moving into a closer and smaller time frame so for example if bitcoin is bullish on the daily chart and I'm seeing bullish momentum on the hourly chart then I might zoom in to the 15 minute or five minute chart to look for some more precise entries so let's start from the top we're looking at bitcoin currently and we're going to zoom out all the way to the one month candle so this is the one month time frame every single candle stick here represents exactly one month so we can see as far back as 2017 and even further back to 2015 it gives us an overview on exactly what's gone on throughout all these years since 2015 all the way up to 2017 crazy crazy bull run to 20k then it tells us a story about the bear market where we went down from 20,000 all the way down to a low of around $3,000 and then finally it takes us back up from that $3,000 to about 15,000 in 2019 then back down to $3,000 again during the pandemic on March of last year and as you can see in this story we went from the bottom of $3,000 and rose like a phoenix from the ashes and went all the way up to new all-time highs of today which are which is in the $50,000 range so this is always how we like to start off our technical analysis when looking over different cryptos different outcoins it could be stocks it doesn't matter what it is this is the best way to start looking at a stock especially or crypto especially if you're not familiar with it you want to always know the overall trend and with the overall story because you want you want to see the big picture to then zoom in and make better decisions remember that technical analysis and trading is all about information the more information you have the better decisions that you can make so that's why you start at the top and work your way down because you want to have all the information you want to gather as much information as possible before risking your hard-earned money so let's go ahead and mark some supporting resistance levels here so I really marked the first one which is this bottom one which is right around that 3,000 level as you can see if we zoom in here you will see that that's basically was the bottom here doing this bear market in 2018 and 19 and when we had the dump of the pandemic it also bottomed out at the same exact price another thing to note remember that technical analysis is never ever exact numbers it's always zones so that's why when when you see this and you see this even though they're not the same exact price it doesn't matter it's in the same zone and that's what matters so what else do you guys see here that could be a support resistance so one that we see right off the bat is this area right here as you guys can see it kind of held up there for a while right around this 6000 area and you see that it also tested it right here so this would be a good area to add another support level there all right we continue looking at the chart another good spot is going to be guess where right around here as you can see there's a lot of price action there a lot of price action there and that's right at that 10,000 level which is also a psychological level so it's definitely a support and resistance level since there's a lot of price action there so we can go ahead and mark that area the next spot I'm seeing uh some price action is right here you see right here and you see right here right so that could also be another area of interest so we're going to go ahead and mark it right at that around that 20 12,000 mark and the final area is going to be from the 2017 where the candles basically closed and opened as you can see we also had price action at that same level and again price action at the same level so that's enough for us to call it another support and resistance level and right at that 14k range of course we're gonna go ahead and do this all time the previous all time high here which you can see here there was a lot of price action in that area so we can definitely say that would be a support and resistance zone so if we go up higher now more into what's been going on lately you can see here there was a lot of price action between these two months right at that 30k range so we're gonna go ahead and mark that 30k range as a support and resistance area as well and then finally as you guys know we just hit 50k today and as you guys will know 50k is gonna be a very big part of crypto moving forward so i'm gonna go ahead and mark that $50,000 area as a support and resistance area as well all right so we started with a blank chart and now just by looking at the monthly chart and overall trend we can tell the very important areas here as we were able to mark some very important points of interest where there was a lot of price action so if there's any retracement or any trades that we're taking we just kind of look for the big support and resistance areas in the overall one month chart time frame to make better decisions when we zoom in another thing you can do as well is draw a femenachi retracement tool from the bottom from the basically the start of the run to the top of the run so what we're gonna do we're gonna go ahead and do it from down here which is the march during the pandemic up to the top of that run now that gives you extra supports and resistance as you guys can see right here here here here those are all different levels where there's going to be price action usually or there's been already price action so you can see here at this exact spot there was a close of the candle and an open of the candle so there was a lot of there was a lot of volume a lot of things going on in that area you can see here it looks like this played as a support there and you can see here this one's actually in line with this other resistance that we spoke about so now we're ready to go on to our weekly time frame so what I like to do once I start zooming in get these levels that are further away and that are not very important right now and just kind of make them as small as possible so that they don't distract you too much you can even fade it out so that the lower the opacity on it so that again it does not pop out too much on the chart because you kind of you always want to try to keep a clean chart overall all right now we're a lot more zoomed in so you can kind of get a better idea of exactly what's been going on on the weekly chart so after the monthly you zoom into the weekly usually we look for important levels and we try to point those levels out the same way we try to make sure that the levels that we use for our Fibonacci and you know the other ones that we posted which we want to make sure that they make sense so as you guys can see here both the Fibonacci and one of our support areas are there so this level definitely makes a lot of sense here there was a whole lot of price action so that's definitely a very important level to use when you're looking for a trade this would be a perfect level a perfect area to enter a support entry there then obviously here this was also a very important level you can see the Fibonacci retracement level there so this was definitely a strong resistance there and now we couldn't see it on the monthly chart but we can see it now in the weekly chart and once we break out of a resistance like we did here that resistance gets flipped into a support so if we were to for some reason get traced back down over here this would be a good entry as a support entry to bounce back up and then as you can see towards the top here we're obviously at a big resistance here so what you would be looking if you're looking to enter a trade up here you kind of want to enter a trade above this area right you don't want to enter a trade so close to this that's why any trades you know within this area right here are a lot riskier because you're trading at the top of the resistance right so you want to trade once we get a breakout above the resistance kind of like we did right here with that candle all right so now we're looking at the daily timeframe we've zoomed in yet again and again you can see how we got rejected there how we had the support there how we had rejection there again before finally getting this breakout which is what's led us now to this new resistance area there now what the daily chart also shows us is better patterns right so here you can kind of see that this is like this is a bull flag here right so we're kind of just grinding up between these levels as soon as we're just consolidating while kind of ascending up with this support and resistance that are both ascending so now we can start taking small you know patterns like this to look for trades but we're keeping in mind the long-term resistance long-term supports so for every trade we're taking we're keeping in mind even though now we're zoomed into the daily and and kind of looking for daily patterns to trade we're keeping in mind what the long term weekly and month support and resistances are to find the highest probable trades possible so for example right now a high probability trade would be a breakout above the current highs but you have to be careful because there will be a lot of fakeouts there there will be a lot of sellers at that 50k range because it's a very big resistance level but on the other side of that once we do break out of there it's going to be a big big move now if we get pushed back then we're looking back at different areas where history showed us that will be big strong support areas right so both of these areas here would be a good support to enter if we were to drop back down right so let's go ahead and draw now a kind of a trend line here for on the daily chart right just kind of to have an idea of what we're looking at we're also drawing a trend line on the top of this pattern and now we're going to zoom into the four hour chart so notice how we continue to gather more and more information and then continue to zoom in to have a better idea of a trade setup that we can possibly come across so now some possible trade setups would be on this ascending trend line right which is going up as you can see it's bounced there it's bounced there and it could possibly bounce here if we get rejected back down here from where we currently are you can also see that this area right here where it got rejected is right at the top of this current pattern that it's trading within so a good idea would have been selling up here and then looking to buy back in down here so currently we're almost right at the bottom here so that level is right around that 48k area so automatically we're looking at 48,000 as a possible support entry we'd be looking to ride that 48,000 back up to the kind of the top of this range we'd obviously we definitely be taking profits starting at 50k but we can look to possibly go as high as 51 as it did previously now we're zoomed into the hourly chart and you can see how much more information it gives us on an hour to hour basis so now we're really zoomed in we we know what's going on overall and now we can start looking for trade setups here as you can see so you see that that 48k range is where we got that bounce you'll see that over here there was a price action there was a whole lot of price action here at 48 as well and we had a big rejection there as well so 48,000 is definitely a point of interest that you can use to enter a trade now that we've seen the whole picture we know what the overall trend is doing and we haven't and we've zoomed in to see where we can take an entry with this information that we've gathered all right guys so hopefully you guys enjoyed this video and we're able to understand exactly what I was trying to explain the whole idea of this is to start at the top bigger time frame so you can see the entire picture then you start zooming in taking in information from each each of the different time frames and the more information that you have available for yourself then the better that you can predict or try to set up a trade that makes sense and has the highest probability possible so that is the whole idea of a top-down analysis learning this will make reading charts a whole lot easier basically I just look at the chart I open up charts I look them for about five minutes and I can tell you know where the trade setups will be and if there's any possible trade setup at the moment just by doing a top-down analysis you know within five minutes and that's basically it because I've already set up the monthly supporting resistance levels I've set up the weekly levels and then when I go into the daily and four-hour charts everything's already set up I just got to look at it see if it's at any of those points that of interest that I want to take a trade in if not then I move into the next one if there is a setup then I go ahead and start looking at setting up a plan to enter a trade there so that's pretty much it guys I hope you guys have enjoyed this video if you found value in this content go ahead and subscribe to the channel guys make sure to hit that like button as well and turn on those post notifications if you guys have any questions about this I know it could be a little confusing when first trying to take it in because it's a lot of information but if you have any questions about anything on this video drop it in the comments and I will do my best to reply to all of you with the proper answers thank you guys so much as always I will see you tomorrow peace and love