11-ICT Mentorship Core Content - Month 2 - How Traders Make 10 Percent Per Month

Last modified by Drunk Monkey on 2022-09-02 12:04
1 00:00:27,930 --> 00:00:41,490 ICT: Looking at how traders make 10% per month. And we're gonna stick with our theme here, using our case study on the Aussie dollar. Now, quickly, obviously
2 00:00:41,490 --> 00:00:51,210 going through everything we've gone through in the previous two sessions, we've identified a 7512 level on a daily chart, we brought that down into a hourly
3 00:00:51,210 --> 00:00:58,950 chart, we noticed that there was bias stops above us. So we know that there's liquidity pools resting above those specific highs. So the market should be
4 00:00:58,950 --> 00:01:16,260 reaching up there, as much as 100 pips from the level where identifying 7512, so we're easily get up to 7612. Looking at the 15 minute time frame, as we shown
5 00:01:16,290 --> 00:01:28,050 earlier, in the series, we've shown that there was a bi setup at 75 to on a daily chart, we had a old low, everything that we referred to, and what to focus
6 00:01:28,050 --> 00:01:41,400 on in September, everything is being identified. In this specific case study, we don't really require the market to give us an hourly set up to get in and use
7 00:01:41,400 --> 00:01:51,510 that risk, we can use a 15 minute timeframe and use the framework that price gives us on that specific timeframe relative to what you see on a 15 minute
8 00:01:51,510 --> 00:02:00,000 timeframe. Obviously, the risk can be reduced from what will be seen on an hourly chart. And then just as well, the 15 minute chart can be reduced down
9 00:02:00,000 --> 00:02:10,770 into a five minute chart. And we identified where the stock could be in relative terms to the bullish order block. And we also framed out where three to one
10 00:02:10,800 --> 00:02:22,830 reward to risk ratios would unfold. And it happened to be right below our first area of buy stops or the five minute liquidity pool. Now this is nowhere near
11 00:02:23,190 --> 00:02:31,950 the level of the objectives we identified framing the trade on an hourly chart by just giving you the context, what if we were to look at the market like this
12 00:02:32,040 --> 00:02:45,240 and say we traded this particular pair and we had a 2% risk on the trade. If we had 2% on the trade, and the market trades up to this high with a buy stop,
13 00:02:45,240 --> 00:02:58,560 sorry, that's a liquidity pool, the market should respond off of that 7512 level because the daily chart, reference point or bullish order block. If we take our
14 00:02:58,560 --> 00:03:10,140 2% position and take half of that position off, as we get three to one, notice it doesn't have to even flow out the buy stops here. These buy stops don't even
15 00:03:10,140 --> 00:03:25,740 have to get blown out. This is three to one reward to risk. So we can take first profit and bank a 1% times three are. So we can make 3% on this one trade here
16 00:03:25,800 --> 00:03:40,140 and still leave the second portion of the trade on aiming for what there's liquidity pools referenced on the hourly chart. Now, as price explodes and goes
17 00:03:40,140 --> 00:03:52,200 through those by stops, obviously you can see going up to a 15 minute timeframe. Now we can go and look at higher liquidity pools reaching into higher and higher
18 00:03:52,260 --> 00:03:59,970 grade liquidity pools until we get to that hourly chart. But for right now just simply look at what's already happened. The framework we used for the five
19 00:03:59,970 --> 00:04:16,230 minute chart that we've outlined in the second session. That model OWN RISK allows us to have 123456789 are in other words, we made $9 for every $1 risk
20 00:04:16,260 --> 00:04:27,180 just reaching into the 15 Minute by stop liquidity pool, the liquidity pools that we saw on our chart, that's what's being identified for our objectives. But
21 00:04:27,180 --> 00:04:40,770 now here we have we have a crossroads. You can we take some of the position off here or do we leave the second balance of the original position of 2% We only
22 00:04:40,770 --> 00:04:49,590 have 1% remaining one, we could take a portion of that off, or we can leave it to go higher and reach those higher objectives.
23 00:04:50,970 --> 00:04:59,970 The choice is going to be yours. Preferably I think I would like to take something off because we're in a really nice liquidity pool relative to 15 Min.
24 00:05:00,000 --> 00:05:07,830 The timeframe, and we might get some consolidation or could be wrong could even reverse here, we don't ever know that. But we are trading with higher level
25 00:05:07,830 --> 00:05:17,160 institutional order flow relative to that daily order block from 7512. We've seen expanse on the upside, it's now taken by stops in the form of a liquidity
26 00:05:17,160 --> 00:05:28,350 pool in the five minute chart we've just shown, then, now we've see the 15 Minute liquidity pool, and the buy stops over here. That's been violated. So
27 00:05:28,350 --> 00:05:40,650 we've already seen nine to one payout, which is astonishing by any measure. And in letting the price go a little bit further, once we clear this buy stop, the
28 00:05:40,650 --> 00:05:54,390 area over here would be reached into as well. And we'd have 15 are as well. Now, this is the liquidity pool that we resting around that same hourly basis. I'm
29 00:05:54,390 --> 00:06:04,950 just viewing it in terms of the 15 minute chart, you can see the expansion is available to you. When you look at the market, framing it with very low risk,
30 00:06:05,520 --> 00:06:17,550 very low risk. Now, notice also we took first profit at a multiple of three to one. So we made $3 for our $1 risk, as soon as we did that we've already made 3%
31 00:06:17,550 --> 00:06:27,240 on the trade with altra short term risk less than 10 pips that was it less than 10 pips. But let's just say we reframe the trade with a little bit more than
32 00:06:27,240 --> 00:06:41,700 that, say we used a little bit more comfortable stop, say it was 20 pip stop. Could that still pay out in handsome rewards? Why wouldn't it obviously, the
33 00:06:41,700 --> 00:06:51,300 market reaches above the stops, we know that the market reaches for 10 and 20 Pip grades for stops sweeping, we have the old high back here, in price just
34 00:06:51,300 --> 00:07:01,080 gets real close to it, but expands right above where we would expect to see price reach for. Here's why I want you to focus. The potential range was about
35 00:07:01,080 --> 00:07:09,480 100 pips from where we were looking at buying and where we thought the price is going to go. We don't need the absolute high and we don't need the absolute low.
36 00:07:09,660 --> 00:07:20,640 We're looking at the lion's portion of the move about nine about 100 pips. Let me ask you a question. Do you think you'll get every pip of every potential
37 00:07:20,640 --> 00:07:32,700 range you identify as potential profit? If you're insisting on it, you're going to be frustrated. But you don't need that? What happens if you just had half of
38 00:07:32,700 --> 00:07:42,540 the range? Would you be disappointed? If you say yes, you would be disappointed. My question is, is why would you be disappointed? Is that better than what
39 00:07:42,540 --> 00:07:49,740 you're doing now, as a new trader, it's probably going to be very easy for you to say, Well, that would be better than I'm currently doing now.
40 00:07:56,279 --> 00:08:06,329 Let's look at some numbers. assume for a moment we had a $1,000 trading account. And we set the trade up. Originally, as we did with the five minute chart, less
41 00:08:06,329 --> 00:08:17,099 than 10 pips we're gonna say we rounded up to a 10 pip stop loss. And the market came up and allowed us to get our three to one multiple. In this trade, we would
42 00:08:17,099 --> 00:08:26,609 already have 3% paid to us. Now, we're going to assume that you've gone through the mentorship, you've learned how to do this, and you've gotten to the point
43 00:08:26,609 --> 00:08:37,409 where you are comfortable trading with live funds. Or maybe you're still in the demo account. If that choice is yours, you have to make the decision and timing
44 00:08:37,409 --> 00:08:48,539 for your own sake, I can't do that for you. But say for instance, you're looking at the trade and frame just like we were outlining here, and it allows you to
45 00:08:48,539 --> 00:09:00,719 get a 2% position one. In other words, the trade is 2% risk. If you have the opportunity to get three to one paid out. And you take that off your position.
46 00:09:00,749 --> 00:09:15,089 Now you have 1% remaining. The first 1% taken off with a multiple three to one. You'd be taking profits if 30 pips, you've already banked 3%. Look what that
47 00:09:15,089 --> 00:09:26,279 does in a month, by itself. It's over 10%. So even if that's all you get is the first profit objective of three to one. So if you frame your trades with really
48 00:09:26,279 --> 00:09:37,679 small risk, it's easy to get multiples of three to one or more for your reward. So you're our levels are easy to get to. When you start refining your risk. See,
49 00:09:37,709 --> 00:09:46,529 it's not having big risk that makes the money. It's having the small risk that makes the money. That's the real secret. The fact that you need to be able to
50 00:09:46,529 --> 00:09:55,259 frame your trades on levels that should see institutional sponsorship. That means should the bank's propel price higher or lower? Because it's a daily chart
51 00:09:55,289 --> 00:10:03,569 or weekly chart or monthly chart those levels are going to be highly impactful in terms of price action, they are going to drive price higher and lower
52 00:10:03,899 --> 00:10:10,109 relative to those levels, because that's what the real orders are. It has nothing to do with your indicators has nothing to do with your supply and demand
53 00:10:10,349 --> 00:10:22,109 or your theory on price. It has nothing to do with that. It's where the orders are. And the order is going to be around monthly, weekly and daily levels. Now
54 00:10:22,139 --> 00:10:32,159 what if you let the portion of that second half go, and you only got half of that 100 pip range? Remember, we were looking at that setup, it was potentially
55 00:10:32,159 --> 00:10:40,259 100 pips available to you. But say you only let it go 50 pips, and you just couldn't bear to hold on to it. And that's all you could do. Or you did
56 00:10:40,259 --> 00:10:46,379 something that got you stopped out early. Okay, you trail your stop up too aggressively, and you only managed to make 50 pips out of that. Now this is
57 00:10:46,379 --> 00:10:57,449 assuming you've already taken that first 1% off, this is the second 1% is remaining on the trade. By itself, if you collapse it 50% of that 100 pip range
58 00:10:57,449 --> 00:11:05,819 we're looking at, you're tacking on another 21 plus percent for the month, if that's all you're doing week after week, if you're getting scenarios like this
59 00:11:05,879 --> 00:11:15,419 one trade, you're focusing in tightly, watching one setup, and you are milking it for everything that it's worth keeping the risk small and looking for higher
60 00:11:15,419 --> 00:11:25,409 timeframe objectives. If you do that, you're looking at 21 plus percent, but it's gonna call it 21 plus your original 3% On the first half of that trade. So
61 00:11:25,409 --> 00:11:35,699 really, what do you make and and you didn't even get the entire 100 pip range. Now think about that. We use the same scenario where we use a 10 pip stop. And
62 00:11:35,699 --> 00:11:45,509 we let the second portion run after three to one was taken off at 30 pips. Then we'd like to rename portion run and say we only managed to get half that 100 pip
63 00:11:45,509 --> 00:11:57,869 range? Who would be upset? Would you be upset with that? I don't think you should. If you are, it's greed. And you can't allow greed do this to you. Now
64 00:11:57,869 --> 00:12:08,189 what happens if you get the entire 100 pip range, so you get your 100 takedown? No one shot one kill, you get it for the entire week, the second portion of that
65 00:12:08,189 --> 00:12:14,819 trade net you over 46%. That's in one month. Okay?
66 00:12:14,910 --> 00:12:24,720 If you'd let this continuously pan out. And you do this every single week, and you're looking for one shot, one kill scenarios, and you get 100 Pip objectives
67 00:12:24,720 --> 00:12:33,270 taken down on the second portion of your trade. Remember, you're already taking partials off at three to one. So you take a 1% off, if every trade you take is
68 00:12:33,270 --> 00:12:41,760 2%. Once you know what you're doing, you scale off 1% at three to one, and you wait for the second portion to reach for these higher, higher timeframe
69 00:12:41,760 --> 00:12:51,960 objectives. That's how you make a lot of money. You pay yourself initially get paid, pay the trader take partials don't listen to people that don't make money,
70 00:12:52,200 --> 00:12:59,640 you have to pay yourself because you don't know if your trades gonna pan out. But once you get three to one, you've already you're already living in an
71 00:12:59,640 --> 00:13:09,060 environment that pays exceedingly well. Think about that. If that's all you managed to do is get first objective at three to one. It's all you ever did.
72 00:13:09,060 --> 00:13:18,240 Nothing ever panned out beyond that, who would be complaining about that only folks that are demanding precision beyond your personal efficiency right now you
73 00:13:18,240 --> 00:13:28,200 can't do it. You don't have that level of efficiency yet. You can grow into that over time, but you have to allow that time to take place. But if you get these
74 00:13:28,200 --> 00:13:39,870 one shot one kills, where you're looking for a nice weekly trade of 100 pip range, you don't need the 100 pip range to pay you out handsomely. But if you go
75 00:13:39,870 --> 00:13:46,740 in aiming for it once in a while, you'll hit it. And we'll just play devil's advocate for a moment. And again, we're going to assume for a moment you did
76 00:13:46,770 --> 00:13:55,290 you're able to take down 100 pips a week, it may require you to do another trade to pan out to get to that 100 pips, I'm not telling you to force yourself to get
77 00:13:55,290 --> 00:14:05,070 100 pips every week. But it may require you to do a secondary or third trade, or you may take another trade and it reduces you down to just this. He's getting
78 00:14:05,070 --> 00:14:14,340 lose, you're gonna have, you're gonna have encountered barriers like everyone else does in trading. But if you're making your second portion of your trade
79 00:14:14,340 --> 00:14:22,200 paying out and you're reaching for higher timeframe objectives, like we just framed up this trade, a low risk trade, it's been framed on a higher timeframe
80 00:14:22,200 --> 00:14:31,440 premise, with the things that I taught you to focus on the month of September is content. The second portion of the trade will always make more than the first.
81 00:14:32,160 --> 00:14:43,920 Obviously, you're getting out early with a partial with a partial is not a weakness. It's not an impediment to you making more money. When when when
82 00:14:43,920 --> 00:14:52,980 traders or educators or other folks say that you're taking off some of the trade before it gets to a profit objective that you had in mind beforehand. That's
83 00:14:52,980 --> 00:15:01,110 coming from someone that does not make money consistently and I'm telling you because they're forcing themselves to hold on for their alternate objective. And
84 00:15:01,110 --> 00:15:10,140 there are two black and white in profit taking. You have to pay yourself when it's available. If you're binary, it's all or nothing. You're never going to be
85 00:15:10,140 --> 00:15:19,650 as good as you think you are, believe me, the I'm very proficient with price action, but I don't demand everything off it my profit objective my higher in
86 00:15:19,650 --> 00:15:28,440 profit objective. I've learned to pay myself because there's many times I've seen, I've had really handsome profits sitting in a trade. But I did not allow
87 00:15:28,440 --> 00:15:35,310 myself to take something off and I watched it come all the way back and turn into a loser or come back and take me out with a modest stop loss and then run
88 00:15:35,310 --> 00:15:45,870 it my favorite, which is very frustrating. And you've probably encountered that yourself. But let's say for instance, you couldn't manage to do that trade with
89 00:15:45,870 --> 00:15:56,100 10 pips and you were just stuck to that one hour setup, no problem. No problem. There's no reason to be upset about that. If you allow that 20 pips setup to
90 00:15:56,100 --> 00:16:09,360 give you a 50 Pip run, okay. Think about this. If you take the first portion of that trade off, and you only get 50 More pips beyond In other words, you've
91 00:16:09,600 --> 00:16:23,250 you've placed your trade on, and you paid yourself a modest 30 pips, move to the sidelines, and then you only managed to get another 50 pips? Well, you made over
92 00:16:23,250 --> 00:16:35,760 10%, right there on the second portion of the trade. Think about that. It's not about how many perfect exits and entries you get. Because this is after your
93 00:16:35,760 --> 00:16:45,450 first profit, you pay yourself something, and then let the partial run, the balance has to run. And that will always pay you more. And here's the thing, the
94 00:16:45,450 --> 00:16:48,750 psychological effects of it not being
95 00:16:51,300 --> 00:17:00,000 a trade, it's already paid you you've taken some skin off of it. And that's good. You have one pound of flesh now, okay, for your time, your energy and your
96 00:17:00,000 --> 00:17:10,500 focus in that marketplace. When you focus on trading like that 10% In one month, on the back end of your trade as not just we've already factored in counting the
97 00:17:10,500 --> 00:17:21,210 first portion of your trade. That goes without saying that, that leads to 12% by itself. But if you can't do this ultra short term trades, you can still do
98 00:17:21,270 --> 00:17:33,120 trades like this. And it's still handsome 10% compounded over the year is over 300% for the for the year. And that's amazing. Where else are you going to get
99 00:17:33,120 --> 00:17:41,010 300% return? There's no money manager, if you're gonna raise his hand, say I'll do that for you. There's no fund manager is gonna say, hey, look, you know, I'll
100 00:17:41,010 --> 00:17:47,430 double your money in a year. I can consistently do that. I'm going to work hard to do that they're not working hard for your money. Okay, they're doing very
101 00:17:47,430 --> 00:17:55,290 little very lazy, and you're gonna watch your money better than anybody else. So when you see things like this, it's really important you focus on that number,
102 00:17:55,470 --> 00:18:03,960 Isn't it astonishing number you can do very, very well with tripling your money every single year. 10% a month compounded does that