Secret Indicator 2x Better Than Heiken Ashi
45sThe promise of a secret, superior indicator immediately grabs attention and curiosity.
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The video introduces an upgraded version of the Heiken Ashi indicator, called the 'Smoothed Heiken Ashi' by TradingView creator jackvmk, which overlays the smoothed candles on top of normal candlesticks to combine the benefits of both. The presenter explains how to configure the indicator, read its signals, and apply a specific trading strategy that includes risk management and partial profit-taking.
Chapters
[00:00]
Introduction of the upgraded indicator
The presenter claims to have found an indicator that is 'infinitely better' and '2x more profitable' than the standard Heiken Ashi, which is used by traders to determine general direction.
[00:47]
Problem with normal candlesticks
Normal candlesticks show a lot of red and green noise, making it hard to tell the price direction and potentially leading to false signals.
[01:03]
Limitations of standard Heiken Ashi
Standard Heiken Ashi eliminates noise but loses 'juicy information' like chart patterns and key support/resistance levels because it only shows a smoothed version of price.
[01:32]
Advantage of the new indicator
The new indicator adds a Heiken Ashi overlay on top of normal candles, allowing traders to see both price action and the smoothed trend simultaneously, providing the best of both worlds.
[02:02]
Fewer false signals
The improved version provides fewer false signals compared to the standard Heiken Ashi; in an example, the standard version placed red candles in an uptrend, while the improved version only showed green candles, avoiding fakeouts.
[02:16]
How to add the indicator
On TradingView, go to the indicators tab, type 'smoothed heiken ashi', and select the one by jackvmk.
[02:33]
Optimal settings
For short-term analysis, set two settings to 5 and 5; for long-term trends, use 20 and 20; the default 10 and 10 is a balanced option.
[03:00]
Reading the indicator
Green candles signal an uptrend, red candles signal a downtrend. The size of the candles indicates momentum: growing candles mean gaining momentum, shrinking candles mean losing momentum.
[03:33]
Momentum shift example
In a downtrend, red candles getting smaller indicate losing downward momentum; a subsequent green candle signals a likely market shift.
[04:40]
Strategy: Don't trade on color alone
Entering a long just because the indicator turns green or short on red will not work long-term; a more nuanced approach is needed.
[04:52]
Strategy: Identify strong trend and reversal
First, find a strong downtrend with red candles getting larger. Then, look for a trend change: red candles start shrinking and then shift to green.
[05:19]
Strategy: Use Heiken Ashi as support
Wait for a pullback to the Heiken Ashi candles, then wait for confirmation that price respects the level (a green candle) before entering the trade.
[05:36]
Strategy: Risk management and exit
Set stop loss at the low of the Heiken Ashi candles, take profit at 1.5 risk-to-reward. When TP hits, sell half the position, move stop loss to entry, and exit fully when the Heiken Ashi turns red.
[06:07]
Claim of profitability
The presenter claims to have made over $70,000 in 60 days using this strategy, calling it one of their favorites.
The video presents a practical upgrade to the Heiken Ashi indicator, offering a way to combine trend smoothing with raw price action, along with a specific strategy that emphasizes confirmation and risk management. While the claims of profitability are unverified, the methodology provides a structured approach for traders.
Mentioned in this Video
Tutorial Checklist
3
02:33
In settings, set the two parameters to 5 and 5 for short-term analysis, or 20 and 20 for long-term trends; default 10 and 10 is also fine.
6
05:19
Wait for a pullback to the Heiken Ashi candles and confirm price respects the level with a green candle.
7
05:36
Enter the trade, set stop loss at the low of the Heiken Ashi candles, and take profit at 1.5 risk-to-reward.
8
05:53
When take profit hits, sell half the position, move stop loss to entry, and exit fully when the Heiken Ashi turns red.
Study Flashcards (10)
What is the main problem with normal candlesticks according to the video?
easy
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What is the main problem with normal candlesticks according to the video?
easy
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They show a lot of red and green noise, making it hard to tell the price direction and potentially leading to false signals.
00:47
What is the main issue with the standard Heiken Ashi indicator?
medium
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What is the main issue with the standard Heiken Ashi indicator?
medium
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It doesn't provide the 'juicy information' of normal candlesticks, like chart patterns or key support/resistance levels, because it only shows a smoothed version of price.
01:03
How does the upgraded Heiken Ashi indicator differ from the standard one?
easy
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How does the upgraded Heiken Ashi indicator differ from the standard one?
easy
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It adds a Heiken Ashi overlay on top of normal candles, allowing traders to see both price action and the smoothed trend simultaneously.
01:32
What are the optimal settings for short-term analysis with the smoothed Heiken Ashi?
easy
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What are the optimal settings for short-term analysis with the smoothed Heiken Ashi?
easy
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Set the two settings to 5 and 5.
02:33
What do green and red candles signal in the smoothed Heiken Ashi?
easy
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What do green and red candles signal in the smoothed Heiken Ashi?
easy
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Green candles signal an uptrend, red candles signal a downtrend.
03:00
How can you identify gaining momentum using the indicator?
medium
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How can you identify gaining momentum using the indicator?
medium
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Candles start off small and slowly get larger, signaling the market is gaining momentum.
03:15
What is the first step in the trading strategy described?
medium
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What is the first step in the trading strategy described?
medium
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Find a strong downtrend by looking for red Heiken Ashi candles that are getting larger.
04:52
What is the second step in the strategy?
medium
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What is the second step in the strategy?
medium
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Find a trend change by seeing red candles start to get smaller and then a color shift from red to green.
05:06
What is the recommended risk-to-reward ratio for the take profit?
easy
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What is the recommended risk-to-reward ratio for the take profit?
easy
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1.5 risk to reward ratio.
05:36
What should you do when the take profit is hit?
medium
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What should you do when the take profit is hit?
medium
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Sell half of your position for guaranteed profits, then move your stop loss to your entry.
05:53
💡 Key Takeaways
🔧
Overlay approach
Combining Heiken Ashi with normal candles solves the trade-off between noise reduction and price action visibility.
01:32
📊
Fewer false signals
The upgraded indicator avoids fakeouts that can cause premature exits, improving trade reliability.
02:02
🔧
Momentum via candle size
Using candle size as a momentum gauge provides a simple yet effective way to assess trend strength.
03:15
⚖️
Confirmation before entry
Waiting for a pullback and confirmation reduces the risk of entering on a false signal.
04:52
🔧
Partial profit-taking
Selling half at TP and moving stop to entry locks in profits while allowing for further gains.
05:36Full Transcript
[00:00] I found an indicator that is infinitely better than the heiken ashi. The heiken ashi, is an indicator that a lot of traders use to find the general direction But what if I told you I found a secret indicator that performs WAY better than the normal heiken
[00:19] indicator and its 2x more profitable than the normal heiken ashi. Ope, come, come on back. There ya go. This indicator uses I m gonna share with you what the indicator is, how to use it to its best potential, and
[00:35] I m even going to share with you a profitable strategy with this indicator. Lets get straight to it. Okay, so is your typical normal candlesticks. Where there s a bunch of red and green everywhere and the chart is pretty hard to tell which
[00:47] way the price is heading with all the noise. This is bad because it could lead to false signals. This is a chart with the heiken ashi. It eliminates the noise to where the candles are replaced and you can clearly see which direction the
[01:03] But this indicator isn t perfect *gasp* One of the main issues with the heiken ashi is it doesn t provide the juicy information normal candles sticks do. It only provides the smoothed out version of the price, not
[01:17] Finding chart patterns or key areas of support or resistance. That s until god himself made this new secret indicator. Actually, his name is jackvmk. But you get my point it s a good indicator.
[01:32] Now the reason this indicator is so good is because instead of replacing your candlesticks it just adds a heiken ashi overlay so you can see both the price action of the candles AND the heiken ashi all in one so you get the best of both worlds.
[01:46] Another great thing about this indicator is it s way better at not providing false signals compared to the normal heiken ashi. For example, this is a chart with the normal candles in this uptrend but then it placed some red ones where it could easily fake you
[02:02] out and make you sell early. Now this is the same exact chart with the improved version of the heiken ashi and as you can see it only provided green candles. So, there s no fakeouts and you would of made way more profit on this trade.
[02:16] So now that we know why this indicator is good, lets add it to our chart and give you the best possible settings for this indicator. I ll be using tradingview as my charting platform. Go to the indciators tab and type in smoothed heiken ashi and click this one by jackvmk
[02:33] Next go to the settings. Alright now the optimal settings depends on changing these two settings to 5 and 5. As this makes it better at analyzing short term
[02:47] these settings to 20 and 20. As that will make it better at finding long term trends. are going to keep it at default at 10 and 10.
[03:00] So this how I use the indicator. Green candles signals an uptrend. Red candles signals a downtrend. This means it s great for signaling possible But here s a secret trick you can use in order to raise the chance of you finding these perfect
[03:15] as a way to identify strength. For example, here the candles start off small and starts to slowly get larger and larger. Signaling the market is gaining momentum and If the candles start to get smaller. You can easily identify the market is losing momentum
[03:33] Here the chart is in a downtrend signaled by the red candles, but you can start to see the candles are getting smaller and smaller, showing its losing the downwards momentum. Then we get a green candle. This signals a market shift is likely to occur,
[03:47] You know why this new indicator is better than the normal heiken ashi And where to begin to start reading it Now it s time to get into some actual profitable strategies using this amazing indicator.
[04:22] But first. Let s get into some of my favorite strategies with this indicator.
[04:40] Now I want to make this clear. You shouldn t just enter a long trade because the heiken ashi turns green and enter a short position just because it turns red. This will not work in the long term. Instead, you should do this.
[04:52] First you want to find a strong downtrend. Again, we can do this by finding red heiken ashi candles and we want to see the candles getting larger and larger. Signaling this is a strong downwards trend. The next step is finding a trend change.
[05:06] We can do that, by seeing the red candles start to get smaller and then a color shift from red to green. But you aren t going to enter yet. Instead, we are essentially going to use the new heiken ashi candles as a support.
[05:19] Wait for price to do a pullback and come back down to the heiken ashi candles. But we still need a little more confirmation. Wait for price to show its going to respect Once we get the green candle, we can now officially enter the trade.
[05:36] Set your stop loss at the low of where it the heiken ashi candles earlier. And set you take profit to a 1.5 risk to reward ratio. But we aren t don t yet. Once price hits your take profit, sell half
[05:53] of your position for guaranteed profits. Then, move your stop loss to your entry. We are then going to wait for the heiken ashi to turn red to sell the rest of our position. Once it does. Exit the trade fully for some really nice profits.
[06:07] This is a beautiful strategy. I absolutely love using it. Test it out and let me know how it worked for you on Instagram. Next we are going to over how I made over $70,000 in 60 days using this specific strategy. This one, is one of my favoirts I use every
[06:24] time!
