The outside close is the safer of the two types. To execute it, when the attacker steps toward you and thrusts the knife at you, you should step outward toward your left just far enough to let the knife pass by. Use your hands to guide the attacker's arm as it passes by you while getting a firm grip on his or her wrist or forearm with your right hand. You should find yourself standing very close to the attacker's upper arm or shoulder with your right hand holding the attacking hand firmly at your side.
When performed correctly, the outside close puts you outside of the line of attack and reduces your chances of getting cut. It puts you in the position of being almost behind your attacker and makes your opponent feel vulnerable. Once you complete the close, you may apply your choice of finishing techniques.