Speaker 1: This last week was one of the most pivotal points in my trading career. I finally took a leap of faith into the magical world of machine learning. As scary as it might sound, I truly think this is where trading is heading. Every day computers are getting smarter and smarter exponentially, and believe it or not, they can actually give us scary good predictions on what the market will do next. So I decided I'll give it the good old trading lab go. I curated machine learning into an indicator, and it wasn't easy. It constantly looks at past years of data in real time and uses that data in order to predict what price is likely to do in the future. And it does a pretty f***ing good job of it. I know, I know, pretty impressive right? But that's not even the impressive part. You see, since this is machine learning and it uses past data to predict, the longer this machine learning runs and the more data it receives, the smarter it gets. This thing is constantly learning, constantly improving, and will do all of this completely by itself in real time. Hell, it's probably analyzed 30,000 candles while I made this intro, so you may be wondering, how does it work? Well, without getting too nerdy, this is how the indicator works in very, very, very simple terms. Essentially, the indicator will track other popular indicator values in real time. These indicators include RSI, CCI, ADX, and some other popular indicators. It will scan all of those indicators at once and all of their values for the entire past chart history of whatever asset you're looking at. Once it gathers all of that data from the asset, it will then find what price did at those specific values. Did it go up? Did it go down? Or did it move sideways? So, for example, it'll look at RSI, see its value, it'll look at CCI, see its value, then do this with a bunch of other indicators. It will note all of those values and see what price did when those indicators were at those specific values. The indicator will then note all of that and essentially create a map of what price did at what indicator values. Once it creates this map, it'll look at what price currently is and what the current indicator values are at. It'll then take the current values of those other popular indicators and look for the closest data points from past chart history compared to the present. So basically, it'll try to find data points from the past that look the closest to what it is currently. But it doesn't just find one occurrence that is close, it finds tens of thousands of occurrences that were close. Once it finds multiple matches of similar occurrences, it'll then analyze what price was doing when the values were similar to what they are now. Then it'll average out all of those outcomes. Then finally, it'll print out its prediction of what price is likely to do. Pretty simple, right? That's not simple. Yeah, I know, it's slightly confusing, but I tried my best, okay? But you don't need to know how it works, you just need to know how to use it. But this machine learning essentially can give a great prediction of what price is likely to do based on previous data values and observed trends from the past. And what's crazy, it does all of this within milliseconds. So when originally making this, we had all of this data, but we needed a way to easily present it, so whoever was using it could easily see within seconds of what was happening. Because of now, it was just this graph of dots, which is not very helpful to anybody. So I created what is called the baseline. Now if you've used my private indicator from the past before, you would have noticed we already had a baseline, which did not have any machine learning whatsoever. Well, in this previous update, we completely upgraded it with machine learning. Let's get into how to actually use this new machine learning feature to predict what price will do next. Actually, I just got an idea. Let's test out this new Siri-based audio editing software I just got. Hey Siri, play classical music. Sorry, I didn't quite get that. Um, can you play some classical music? Sure, playing rock music now. Rock? No. No. Siri, stop. Play classical music. Did you say how to double your money? How to double my money? What? That doesn't even sound similar to what I- Yes, you heard her right. You can double your money. How do I do that? Well, there's a Forex broker out there that I personally use, and their name is Hankertrade. If you use the link in my description and it's your first time depositing, they will match whatever you first deposit. So, say if you first deposit $69, they will match that and give you $69. That's pretty cool. If you need a new Forex broker and want that deposit bonus, use the link in my description. Okay, let's actually get back to how to use the new machine learning feature. It's very simple. There are three colors, green, which is bullish, gray, which is consolidating, and red, which is bearish. But there are also different variations of those colors. For example, if the baseline is a darker green, that is a stronger bullish signal compared to the lighter green. If the baseline is a darker red, that is a stronger bearish signal compared to the lighter red. So, essentially, the darker the color, the more the machine learning is confident about that specific direction. If you wanted a more specific answer, we also have this. We added a new metric to the trend table called the machine learning metric. This value will update in real time and will have a corresponding color depending on if it's bullish, bearish, or consolidating. So there are a lot of different ways you can use this new machine learning feature to accurately predict what price will do next. Now, after doing some testing, I found this new feature works best for using it as confirmation rather than entering and exiting solely based on it. For example, just entering when it turns green and then exiting when it turns red. I found it works way better when used with other confluences. For example, one of the popular strategies I like using with the indicator is using the order block feature. For this strategy, I like using the one hour time frame. The strategy goes something like this. This green box is the order block. We want price to basically come down to this order block and show it respects it. You can tell if price is respecting an order block if it starts slowing down right at the block and it does not go through the order block. It's okay if the lower wicks go through it, like this, but it would be considered a bad order block if the body of the candle went straight through it, like this. So as you can see in this example, price came down to the order block perfectly and shows that it's respecting it. But if we wanted to add that extra bit of confirmation, we can add the machine learning tool to this strategy. So if we look closely, the machine learning baseline went from gray, which is consolidating, to green as this order block touch was happening. Showing that this machine learning is starting to think this price action is bullish, which is an even greater addition to enter this trade. So we can enter here, and look what ends up happening. The chart spikes up. Here's a different example. Here price is coming down to the order block again, and it's actually showing some signs of slowing down and that it wants to respect it. But if we look closely at the machine learning baseline, it's pure red, which is a bearish sign. So even though price is showing that it respects the order block, we do not enter this trade, because the machine learning says the price action is bearish. And good thing we didn't, because the price falls pretty good after this. And you can see just from looking at this chart how accurate the machine learning tool is. It was red for this whole drop, then turns green for a little bit on this slight rise. And before price even drops, it turns gray, showing signs of a shift in character, then turns bright red as it falls. Then once price levels out and starts losing the bearish momentum, it starts turning green again, and starts to head upwards. I'm telling you, this tool is f***ing awesome. But this is just one example. There are so many cool ways we can use this. One of my personal best ways I like using it, is using it for higher time frame confirmation. What I mean by that is going on a higher time frame, like the 4 hour or daily. Then see what the machine learning tool is telling us. So right now we are on the 4 hour time frame, and right here you can see the machine learning is pure red. But then all of a sudden it turns gray, and even turns green right after. So now we have a bullish confirmation bias on the higher time frame. And we can expect today to be a bullish day. So now we can go to a lower time frame, like the 5 or 15 minute, and do our normal analysis here, but with a bullish confirmation bias. For example, only taking the indicator long entries, and ignoring all the short entries. You could even go to the settings of the indicator, and change the market consensus to bullish, so you get more long trades compared to short trades. Since you know the machine learning says there's a higher chance of it being a bullish day. Or only following bullish order blocks, and not bearish order blocks. Or you could even do your normal price action trading analysis, but only look for longs. Another way you can use it is for take profits. For example, say if we were in a short trade right here, which is confirmed because of the red baseline. But as the chart moves forward, it starts turning gray, which is a sign that the chart is starting to lose downwards momentum. Then it even ends up turning green all the way down here, which is an indication that the chart is starting to turn bullish. So if you did enter a short up here, it might be a good time to start looking for profits right around this area, because the baseline has changed colors, and is indicating a shift in momentum. And look what ends up happening, the chart heads upwards. And this is really just the surface of the capabilities of what this new machine learning tool can do. Members that already have the indicator are posting results and their strategies on what's working for them in the indicator discord channel. And some people are posting some really cool stuff. So I'm extremely proud of this tool and the capabilities of it, and I'm even more excited for you guys to find different ways you can use it and share it with the community, so we can all benefit from it. Because I don't want to just create indicators, I want to create a community of traders working together to find the best strategies and tactics to use with those indicators. So yeah, that's how I added machine learning into an indicator. If you're interested in the indicator, you can check it out at tradinglab.ai, or I'll leave a link in the description. If you ended up finding a nice strategy with the new machine learning tool, leave a comment on this video. I would love to hear. Thanks for watching, and I'll see you guys next time.