How to read a SENSEI Outlook

Levels, bias, confirmation and invalidation — the anatomy of one call.

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An Outlook is a short study of one market, written by SENSEI, our AI analyst. This page takes one Outlook apart, piece by piece. Read it once, and every Outlook will make sense.

Outlooks are for learning. They are not advice to buy or sell. Please don't copy trades blindly. Read our Risk Disclaimer.

What an Outlook is

An Outlook looks at one market on one chart. For example, Apple shares on a chart where each bar is 15 minutes.

It answers four simple questions:

  • Which way might the price go — up or down?
  • At which price would the idea start?
  • At which price would the idea be wrong?
  • Where could the price go if the idea works?

It also says how sure SENSEI is.

You find Outlooks in the DOJO. Click Outlooks in the menu on the left. Then click a row to open one.

The title names the market and the timeframe, like NASDAQ:AAPL · 15m. That means Apple shares, on a chart where each bar (candle) is 15 minutes. The timeframe is the time each bar covers.

Under the title you see Outlook by SENSEI, when it was published, and the date it is valid until.

Next come small labels:

  • The market type — for example Stocks.
  • The timeframe — for example 15m.
  • The bias — the direction SENSEI expects. Bullish means up. Bearish means down.
  • Confidence — how sure SENSEI is, from 0 to 100%. It is not a promise. An Outlook with high confidence can still fail.

Then come five boxes: Bias, Entry, Invalidation, Target and Confidence. The next section explains the prices in them. The DOJO page explains the rest of the Outlook page.

The levels: entry, stop and targets

The prices of an Outlook are called its levels. You find them all in the Levels box.

  • Entry — the price where the idea starts. Sometimes it is a range of prices, called the entry zone.
  • Stop — the price where the idea is wrong. The page calls it Invalidation. Many traders leave a trade there, to keep the loss small.
  • Targets — the prices the idea aims for: TP1, TP2, TP3. TP1 is the nearest. TP means "take profit".

On a Bullish Outlook, the stop is below the entry and the targets are above it. On a Bearish Outlook, it is the other way round: the stop is above, the targets are below.

A 15-minute chart of NASDAQ:AAPL up to the moment an Outlook is posted. To the right of a dashed line, an entry line at 346, a red stop line at 348 above it, and three green target lines at 344, 342 and 340 below it.A 15-minute chart of NASDAQ:AAPL up to the moment an Outlook is posted. To the right of a dashed line, an entry line at 346, a red stop line at 348 above it, and three green target lines at 344, 342 and 340 below it.
An example of a Bearish Outlook, drawn on real Apple prices, 15-minute bars. It is an example, not a real Outlook. 1 — the moment the Outlook comes out. 2 — the entry, 346. 3 — the stop, 348. 4 — the nearest target, TP1, 344. 5 — the furthest target, TP3, 340. The red area is what you could lose. The green area is what you could win.

R compares a result with the risk. The risk is the distance from the entry to the stop. In the example, the risk is 2 (from 346 to 348). TP1 is 2 away from the entry, so TP1 is 1R. TP2 is 2R, and TP3 is 3R.

R:R, under the Target box, compares the furthest target with the risk. Here it is 3.0.

One-way and two-way Outlooks

Most Outlooks are one-way: one idea, in one direction.

A two-way Outlook carries the label Two-way. It gives two ideas, called scenarios:

  • a Buy scenario — the idea that the price goes up;
  • a Sell scenario — the idea that the price goes down.

Each scenario has its own Probability: how likely SENSEI thinks it is. Each one also has its own Trigger — its entry price — and its own Stop and targets. Instead of the five boxes, the page shows a Scenarios box with both.

Drawn candles moving sideways in a narrow range. To the right, a green trigger line above the range, a red trigger line below it, one red stop line in the middle, and green target lines above and below.Drawn candles moving sideways in a narrow range. To the right, a green trigger line above the range, a red trigger line below it, one red stop line in the middle, and green target lines above and below.
A two-way example, on drawn candles. The price moves sideways. 1 — the Buy scenario's trigger, its entry price, above the range. 2 — the Sell scenario's trigger, below it. 3 — the stop. Here both scenarios use the same stop, in the middle of the range. 4 — the Buy scenario's targets. 5 — the Sell scenario's targets.

Only one of the two scenarios can become the trade. See Two-way: the first to fill is the trade.

Confirmation: the sign the analyst waits for

Some Outlooks also name a sign to wait for before acting. That sign is the confirmation. It is the analyst's own idea of a good moment to act, in SENSEI's words.

On a two-way Outlook, it is the short line under a scenario's Trigger. For example: a 15-minute candle closes above 102. On a one-way Outlook, SENSEI's text says it.

  • A candle closes above a price when its last price, at the end of its time, is above that price.
  • A wick is a quick spike past a price that comes back.

Our results don't wait for the confirmation. A trade counts as started as soon as the price reaches the entry, even with a wick. The confirmation line stays on the page, so you can see what the analyst would wait for.

What makes an Outlook wrong

An idea can fail in a few ways:

  • The price reaches the stop. The idea was wrong. The result is Stop · −1R: the loss was the full risk.
  • The price never reaches the entry in time. The idea never started. The result is Not filled.
  • The price jumps over the entry and reaches TP1 first. The chance was missed. We never chase the price, so the idea is cancelled. The result is Not filled. See When the price jumps over the entry.
  • On a two-way Outlook, the other scenario starts first. Then this scenario is Cancelled.

How long an Outlook lasts

Every Outlook has a Valid until date. You see it in the Outlooks list and under the title.

Short charts get a short time. An Outlook on 15-minute bars lasts a day or two. An Outlook on daily bars can last a few weeks.

  • If the price never reaches the entry before then, the result is Not filled.
  • If the trade is still running when the time is up, the result is Expired. We score it at the last price.

When an Outlook is finished, it leaves the Outlooks list and moves to Results.

How Results scores an Outlook

We check every Outlook against real market prices, minute by minute. Nobody types a result in by hand.

  1. Filled — the trade starts the first time the price reaches the entry after the Outlook comes out. A wick is enough. We don't wait for a candle to close, or for the confirmation.
  2. Targets — each time the price reaches a target, we note it.
  3. The stop moves — after TP1, the stop moves to the entry. After TP2, it moves to TP1, and so on.
  4. One result — each Outlook gets one result, only once.

The result is one of these:

  • A target, like TP2 · +2R. When the price came back to a moved stop, a line says so, like stopped at TP1.
  • Stop · −1R — the price hit the stop before any target.
  • Expired — the time ran out while the trade was running.
  • Not filled — the trade never started.
The same AAPL example to its end. The price rises to the entry at 346, then falls to TP1 at 344 and TP2 at 342, then comes back up to 344. A red line steps down from 348 to 346 to 344, showing the stop as it moved.The same AAPL example to its end. The price rises to the entry at 346, then falls to TP1 at 344 and TP2 at 342, then comes back up to 344. A red line steps down from 348 to 346 to 344, showing the stop as it moved.
The same example to its end. 1 — the price comes up to 346: the trade is filled. 2 — the price reaches TP1. The stop moves to the entry, 346. 3 — the price reaches TP2. The stop moves to TP1, 344. 4 — the price comes back to 344. The Outlook is finished: TP2 · +2R, stopped at TP1. The red steps show the stop as it moved.

The result keeps the furthest target. In the example, the price came back to TP1 after TP2. So the result is TP2, stopped at TP1.

Two-way: the first to fill is the trade

A two-way Outlook gets one result too. The scenario whose trigger the price reaches first is the trade. At that moment, the other scenario is Cancelled. It gets no result, even if the price reaches its trigger later.

Drawn candles. The price breaks below the range and reaches the Sell trigger, falls to TP1 and TP2, then rises again and reaches the Buy trigger. The Buy scenario's lines are faded.Drawn candles. The price breaks below the range and reaches the Sell trigger, falls to TP1 and TP2, then rises again and reaches the Buy trigger. The Buy scenario's lines are faded.
The two-way example to its end. 1 — the price reaches the Sell trigger first. The Sell trade starts there, at 99.60. 2 — the price reaches TP1. 3 — the price reaches TP2, the last target. The Outlook is finished. 4 — later, the price reaches the Buy trigger. Nothing starts: the Buy scenario was cancelled when the Sell trade began.

On Results, you see the trade's result and the other scenario as Cancelled. If neither scenario fills before the Outlook's time runs out, the result is Not filled.

When the price jumps over the entry

Usually the price moves step by step, so it trades at the entry on its way past. But sometimes it jumps over the entry without trading there. For example, when the market opens again after a break.

Drawn candles move sideways below an entry line. One candle closes below the entry, the next one opens above it, and that candle reaches the TP1 line. The price never comes back down to the entry.Drawn candles move sideways below an entry line. One candle closes below the entry, the next one opens above it, and that candle reaches the TP1 line. The price never comes back down to the entry.
A Buy scenario, on drawn candles. 1 — the entry, 101.60. 2 — the jump: a candle closes below the entry, and the next one opens above it. Nothing traded at the entry. 3 — that candle reaches TP1 before the price comes back to the entry.

If the price then reaches TP1 before it comes back to the entry, there is no trade. We never chase the price. The idea is cancelled, and the result is Not filled. It counts as neither a win nor a loss.

If the price comes back to the entry first, that counts: the trade starts there, as usual. If one bar right after the jump touches the entry, the stop and TP1, we can't know their order, so that Outlook gets no result.

On a two-way Outlook, the other scenario stays open. It can still fill and become the trade.

More details: How results are decided and The fine print.

These examples are for learning. They are not advice to buy or sell. You decide what to do with your own trades.

Where you see all this

  • Outlooks in the DOJO — the Outlooks that are still running. Click a row to open one.
  • The Outlook page — everything on this page. Click Load in KAGAMI ↗ to see the levels on a live chart. See KAGAMI.
  • Results in the DOJO — finished Outlooks, wins and misses. Click Result › on a row for the details. See Results.
  • The bell — TAIKO tells you when a new Outlook comes out, when a target is reached, and the result. See TAIKO.
  • Telegram — with a TAIKO plan, Outlooks, updates and results come to Telegram too. See Outlooks on Telegram.

New word? See Words we use.