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100-ICT Mentorship Core Content - Month 10 - Index Futures - PM Trend

Last modified by Drunk Monkey on 2022-10-26 08:53
1 00:00:00,000 --> 00:00:09,510 ICT: Okay, folks, welcome back. Again, we're dealing with a commodity issue. So it's important you read this disclaimer. As a reminder, I'm not a licensed CTA.
2 00:00:09,570 --> 00:00:18,270 I'm not giving you commodity trade advice. Everything that's been discussed here is for informational purposes only and should be viewed in light of a paper
3 00:00:18,270 --> 00:00:27,030 trade only. Okay? June 2017, ICT mentorship, ICT index trading lesson three, the pm trend
4 00:00:34,650 --> 00:00:51,990 Alright, the pm trend, this is the afternoon session in North America. And it's typically after the noon, New York launch our new york pm session is viewed by
5 00:00:51,990 --> 00:01:05,250 way of defining the 1pm to 1pm hours New York time. You can see here on the chart to your right, the beginning and end of delineated the whole shaded in
6 00:01:05,250 --> 00:01:21,870 blue area. That's the pm trend time window or the New York pm session. The two day high or low will tend to form in between the hours of 3pm and 4pm New York
7 00:01:21,870 --> 00:01:36,540 time. Typically it's the last hour. And between 1pm and 4pm New York time, there's typically a trend or a price swing that seen daily. And this is going to
8 00:01:36,540 --> 00:01:49,110 be referred to in this month's content as the pm trend or the afternoon swing. The pm trend can be a continuation of the am trend direction or an intraday
9 00:01:49,110 --> 00:02:02,550 reversal going into the close. Measured moves in the afternoon tend to be faster than that which was seen in the am session. And typically 2pm New York Time sees
10 00:02:02,550 --> 00:02:12,090 the move begin now can start as early as 1pm in the New York time, with generally around two o'clock in the afternoon New York time they really start to
11 00:02:12,090 --> 00:02:24,390 heat up and the sessions begin to move towards the closing basis of each trading day. I want to look at a few examples here. Now again, these are the same slides
12 00:02:24,960 --> 00:02:36,480 from the am session, all I'm doing is giving you greater detail by way of separating the am and the pm session by way of the New York lunch just know as a
13 00:02:37,680 --> 00:02:51,270 point of reference, which is noteworthy. While I say the New York lunch hour, it's basically implying that lunch is noon to 1pm it can actually be as early as
14 00:02:51,270 --> 00:03:01,020 11am to as latest 2pm depends on the current market environment. But generally if there's a fast market in the morning, traders are going to want to probably
15 00:03:01,020 --> 00:03:09,930 work through lunch. So short lunch periods, or short little periods of consolidation or retracement is typically seen in those conditions. When the
16 00:03:10,200 --> 00:03:22,890 session in the morning was rather lethargic. The full lunch hour could be by way of 11 o'clock to one o'clock or even two o'clock can be seen. It's not a event
17 00:03:22,890 --> 00:03:33,030 it takes place a lot like that. But generally you want to be expecting some measure of consolidation or retracement around the noon to 1pm New York time.
18 00:03:34,920 --> 00:03:46,260 After that time of day again, our focus is going to be on what the market does in terms of trading between the 1pm and 4pm time windows as you can see here
19 00:03:46,260 --> 00:03:56,520 during the pm trend of this particular day in the E Mini s&p the afternoon session drops down into a or block that was formed during the am session in
20 00:03:56,520 --> 00:04:08,310 price vaults and trades off that bullish order block into the high of the day, which is seen in the last trading hour. Going into the close
21 00:04:13,530 --> 00:04:26,400 another example showing the relationship between pm trend in relationship to that is seen in the am session can be over time windows delineated here. And we
22 00:04:26,400 --> 00:04:39,870 see again, price trading down into a bullish order block that was seen in the am session and price rallies away from the bullish order block up into a rejection
23 00:04:39,870 --> 00:04:51,450 block. Now again, it's not a lot of movement. Again, it's generally the nature of indices. There's going to be days where there's going to be a large range day
24 00:04:51,450 --> 00:05:02,880 and we can move in a lot of handles or for big figures. But generally, it's not going to be like that it's going to be small consolidation, expansion, that type
25 00:05:02,880 --> 00:05:20,490 of thing. In this case here you can see the price moved almost 400 points in the afternoon session and it went up into a rejection block ain't another example
26 00:05:20,490 --> 00:05:35,460 here s&p Emini, we have our pm trend time window delineated here. Again, we can see another rejection block form. Price trades down into the previous range
27 00:05:36,360 --> 00:05:50,940 trades below the last down close candles closing price. And at the beginning of the pm session, that large red candle violates that previous session or am
28 00:05:50,940 --> 00:06:05,460 sessions rejection block and there's an accumulation phase that takes place in the market rallies about 18 handles. So nice pm session day there. Now we're
29 00:06:05,460 --> 00:06:20,670 gonna look at the pm session or pm trend on the dow E Mini futures. Again, it's the same delineation and time we're looking at how price moves in the form of a
30 00:06:20,670 --> 00:06:32,280 rejection of previous high or a turtle soup. So the afternoon session can create a reversal or it can be a continuation in this case we see the afternoon session
31 00:06:32,280 --> 00:06:49,410 creating a reversal Okay, now we're gonna look at the NASDAQ emini futures. Again, the same delineation and time we're looking at the market trading down
32 00:06:49,410 --> 00:07:03,600 into a overbought that was formed during the lunch hour. And the bulls were box sends price higher up into a rejection block that was seen forming in the
33 00:07:03,720 --> 00:07:19,230 morning session. In this case, here, we see about nine four handles, treated up into going into the close, nice pm session tree. And you can see trading in that
34 00:07:19,260 --> 00:07:35,460 rejection blog, as noted here. All right, as we shown with the index SMT for the am session, the same thing applies for the pm session. But we're gonna be
35 00:07:35,460 --> 00:07:51,150 looking for the highs and the lows between noon and 3pm New York time. So the relative highs and lows the form. After noon, or 12pm, New York time to 3pm New
36 00:07:51,150 --> 00:08:05,040 York time, we're gonna be looking at the relationship between all three of the indices and their respective lows or highs. And if we see, for instance, even
37 00:08:05,040 --> 00:08:15,150 the institutional order flow is bullish, really looking at the lows comparatively, one indicee is going to fail to confirm a lower low, it's usually
38 00:08:15,150 --> 00:08:31,320 seen or what we typically seen in all three. When that occurs that's bullish. We're seeing this occurring in the pm session here. And the opposite will be
39 00:08:31,320 --> 00:08:41,460 seen with institutional order flow when it's bearish when we compare relative highs and one indices going to fail to confirm higher highs when all three of
40 00:08:41,460 --> 00:08:52,380 them will be moving higher, one will fail to move at a higher high and that will be deemed bearish. In this instance, here, we can see that the E Mini s&p in the
41 00:08:52,380 --> 00:09:06,090 pm session on this particular day, during the afternoon session, we saw a higher low form. And the Dow futures has shown a higher low as well.
42 00:09:07,530 --> 00:09:18,180 But notice what we see here in the Nasdaq futures contract, we see that that makes a lower low. That's a break and what will be expected. Normally we would
43 00:09:18,180 --> 00:09:28,560 expect to see the NASDAQ create a higher low as well. For symmetrical market. That's perfect that would be viewed as confirmation. But what we're seeing here
44 00:09:28,560 --> 00:09:43,710 is there's any accumulation in the Dow and in the s&p not seen in the NASDAQ. So while the NASDAQ was the lethargic Sr, or six SR of the three, the Dow and E
45 00:09:43,710 --> 00:09:55,950 Mini s&p Both showed relative strength by failing to make a lower low and you can see the reactions after the divergence was noted. 2pm Here is the equivalent
46 00:09:55,980 --> 00:10:07,740 of 3pm in New York time because the bar chart uses the Central Time or Chicago time. And by looking at that divergence, we can see that there's a strong
47 00:10:07,740 --> 00:10:20,070 accumulation in the Emini, s&p, and the Dow. Now again, I use these diversions to signal trades in the E Mini s&p Or vice to trade the s&p, it would be just me
48 00:10:20,070 --> 00:10:32,760 using these reference points. If I see that crack among all three, my trades gonna be taken in the s&p. I'm not trying to trade the Dow or trading the Nasdaq
49 00:10:32,760 --> 00:10:44,430 futures. I'm primarily focusing on this crack to tell me if there's going to be upside movement in the s&p or downside movement and s&p. The drop down on this
50 00:10:44,430 --> 00:10:53,010 particular day in the morning session, that could have been dropping down into a higher timeframe discount array, and then it showed a rejection early on in the
51 00:10:53,010 --> 00:11:04,620 morning. And then we saw the larger higher timeframe move, unfold going into the afternoon session, and the accumulation that's seen by way of smart money. Their
52 00:11:04,620 --> 00:11:13,950 footprint is seen here with the divergence with the index SMC. So now we've contrasted the characteristics of the am session, we've introduced the quiet
53 00:11:13,950 --> 00:11:25,410 period of the day, the lunch hour, and then the restart or the resuming of activity with the pm session trend. Again, it begins around 1pm New York time
54 00:11:25,410 --> 00:11:36,780 and extent always at 4pm. At the close, the last hour 3pm Going into the last hour of equities trading that last hour can create the opposite end of the
55 00:11:36,780 --> 00:11:46,410 range. Now we mentioned in the am session teaching that typically that opening range or first hour trading creates the higher low of the day. Now if that's the
56 00:11:46,410 --> 00:11:54,390 case, then we know that the last hour of the trading day, which is three o'clock to four o'clock New York time, generally will create the opposite end of the
57 00:11:54,390 --> 00:12:04,050 range. So if we see a low form in the morning session, and it's been a really strong up day, and during lunch, we see no retracement and the pm session starts
58 00:12:04,050 --> 00:12:11,340 to indicate they want to go higher too, we can feel confident that any trade that we trade in the same direction that was made from the am session will
59 00:12:11,340 --> 00:12:21,600 continue going into that last hour of trading. So as soon as the bond market closes at 3pm New York time, that's usually when the market makes its higher low
60 00:12:22,050 --> 00:12:31,110 in respective terms to what was seen in the same session. So if the am session creates the low of the day or suspected low of the day, the last hour 3pm to
61 00:12:31,110 --> 00:12:40,260 4pm. New York time will create the high of the day. If the am session, or first hour trading day creates the high the day then we know that most likely if it's
62 00:12:40,260 --> 00:12:48,690 going to be a down close day, it will continue to go lower until the bond market closes. And shortly after three o'clock. You'll see the low of the day form and
63 00:12:48,690 --> 00:12:58,380 it goes into the clothes at 4pm. So hopefully this has been insightful to you. We're going to blend these things into a cohesive trading plan. Our next lesson
64 00:12:58,380 --> 00:13:06,780 is going to talk about how we can pick targets once we understand what session we're gonna be trading in. Until then, I wish you good luck and good trading