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17-ICT Mentorship Core Content - Month 3 - Timeframe Selection and Defining Setups

Last modified by Drunk Monkey on 2022-09-02 11:07
1 00:00:37,020 --> 00:00:47,670 ICT: Okay, folks, welcome back. This is the first of eight teachings in the third month of the ICT mentorship. And this topic is going to be specifically
2 00:00:47,670 --> 00:01:00,240 dealing with the timeframe selection and defining setups for your model. Okay, for timeframe selection, there's a couple of things that we break down in
3 00:01:00,240 --> 00:01:18,870 general ideas in terms for the monthly chart, we use this for position trading. And for folks that are intraday. intolerant, that means you can't do anything in
4 00:01:19,140 --> 00:01:28,140 lower timeframes, the monthly charge guy is going to do a lot of assistance for your trading and your analysis. So don't don't be discouraged by the fact that I
5 00:01:28,140 --> 00:01:37,920 do a lot of intraday work and short term trading, you'll be shocked to learn as we go through this mentorship, the precision and the accuracy that I have as a
6 00:01:37,920 --> 00:01:50,280 lot to do with the direction that's derived by the information on the monthly chart. But as it is, the monthly charts are the basis if you will, for our long
7 00:01:50,280 --> 00:02:00,600 term position trading. Now I can admit to you like I've done many times in the past, I am not a long term trader, I don't have the personality to to hold on to
8 00:02:00,600 --> 00:02:10,170 a position that long, I tend to change my mind a lot. And that doesn't fit well for a long term position trader. So if you're a person, it takes a long time to
9 00:02:10,170 --> 00:02:20,100 make a decision, it comes hell or high water, you're sticking with it. That's probably the avenue that will best suit you as a trader. Now, I can't determine
10 00:02:20,100 --> 00:02:30,780 that no one can do that. But you and that's going to come by way of you actually doing trades. If you get real scared or if you get real, hyper about the short
11 00:02:30,780 --> 00:02:41,370 term nature of trading. If you trade on these longer term charts, or at least trade off of the the ideas that come from the monthly charts, it removes a lot
12 00:02:41,400 --> 00:02:55,380 of the price action shock that comes with intraday trading or short term trading. The weekly chart, we use that for Swing Trading. Now swing trades a
13 00:02:55,380 --> 00:03:06,840 little bit more frequent than long term position trading. Swing Trading is invite by my definition, it's typically a one or two trades within a three month
14 00:03:07,710 --> 00:03:16,290 period. So every quarter of the year. In other words, every three to four months, there's going to be a setup that takes place. And you can find them very
15 00:03:16,320 --> 00:03:26,190 easily on a weekly chart. Because the weekly chart is much like the monthly in regards to how long it takes to form the setups. It takes a great deal of
16 00:03:26,190 --> 00:03:36,450 patience. And while I am attributed to having a lot of patients, it's not that great. In other words, the well doesn't go that deep, I don't have that much of
17 00:03:36,450 --> 00:03:48,900 patients. So the weekly chart. Again, while I may not be trading specifically on the setup itself, I will use those ideas to help frame the short term trades
18 00:03:48,900 --> 00:03:59,850 that I take for even a day trades. But for Swing Trading, again, for those individuals that can't be in the marketplace on a very intraday minute by minute
19 00:03:59,880 --> 00:04:07,680 basis. Again, that weekly chart will actually serve you very well. And you don't have to do a whole lot of trading and a whole lot of time in between the setups
20 00:04:07,770 --> 00:04:21,180 and much like the monthly chart, it removes that that initial shock of short term volatility. Now the daily chart, that's where we do our short term trading.
21 00:04:22,080 --> 00:04:30,420 The daily chart to me personally, I believe this chart is the best chart there is because it gives you the best of both worlds it gives you a long term
22 00:04:30,420 --> 00:04:37,770 perspective, it gives you all of the near term banking levels. So all the levels of the banks would be interested in all the large funds would be interested in.
23 00:04:38,040 --> 00:04:48,750 You can clearly see those on this daily chart. The daily chart also gives us the framework to do a lot of analysis for short term trading. So it has the benefits
24 00:04:48,780 --> 00:04:58,440 of higher timeframe but not to the degree of weekly and monthly but it does give you a higher timeframe perspective. So if we can arrive at strong analysis
25 00:04:58,440 --> 00:05:08,160 reference points in terms of things ditional order flow, if we can look at points at which there may be stops, there may be a liquidity void, there may be
26 00:05:08,160 --> 00:05:19,110 a fair value got these ideas and much like we said in the first month of this mentorship, what things you should be specifically focusing on those ideas. If
27 00:05:19,110 --> 00:05:29,910 you apply that to the daily chart, you'll have a plethora of setups and plenty of things to trade on. Now, you can trade on a daily chart, again, if you are
28 00:05:31,620 --> 00:05:41,130 the type of trader that hasn't the opportunity to trade in front of the charts being the intraday price action, or again, if you're not comfortable trading,
29 00:05:41,130 --> 00:05:50,460 and there's lower timeframes. The daily chart does a very good job of suiting, swing traders and short term traders. So that to me is the reason why I like the
30 00:05:50,460 --> 00:05:58,950 daily chart the best if there was a chart selection, I had someone hold a gun to my head, which chart would I like to trade off of it would be the daily chart,
31 00:05:59,370 --> 00:06:08,160 because it gives you a great deal of range to work within it gives you the interbank levels to be monitoring where stops will be residing, where long term
32 00:06:08,280 --> 00:06:20,160 objectives will be seen in form of liquidity above or below the marketplace. And, again, I counseled you that can't be in the day trading models that we use,
33 00:06:21,000 --> 00:06:34,650 to try to at least try your analysis on the daily charts, and try to work on those specific timeframes. And if you still feel very sensitive or scared, or if
34 00:06:34,650 --> 00:06:44,610 you have a lot of inflammation and emotional or influence over your emotions, by watching price on daily charts seems a little too fast for you move up to the
35 00:06:44,610 --> 00:06:52,320 weekly chart. Okay, there's nothing wrong with doing that. It just takes a lot more time. And unfortunately, some of you that are listening, you may have a
36 00:06:52,320 --> 00:07:00,240 business and you may have a lot of things going on in life, maybe you're a college student, okay, maybe you can't be in, in front of the price action on an
37 00:07:00,240 --> 00:07:06,570 intraday basis. When we trade these higher timeframes, you're gonna see that there's a lot of movement available, but you're gonna have to submit to a lot of
38 00:07:06,570 --> 00:07:16,110 time too. And now, obviously, four hours or less is day trading. And we're not gonna speak too much about day trading in this particular teaching, because
39 00:07:16,110 --> 00:07:27,150 there's a lot of things that we got to go in regards to day trading and our specific concepts that are inherently related to time of day. So while we're not
40 00:07:27,150 --> 00:07:40,290 going to teach that here, that focuses you time st timeframe selection, in what timeframe? Are we using these specific timeframes for defining setups for your
41 00:07:40,290 --> 00:07:51,990 model. Now, it's important as a mentor, I don't try to force you into a specific mode. It's never been my goal to give you a copy may be just like ICT, that's
42 00:07:52,020 --> 00:08:04,500 not going to work. It's never going to work for anyone. But it does give you a goal. It gives you a framework to work within. While striving for replication of
43 00:08:04,500 --> 00:08:12,450 some of the things you probably see me do, you're going to discover the trader that actually resides in you. And when that happens, and no one knows when
44 00:08:12,450 --> 00:08:22,710 that's going to occur. You'll know it by experience being in the marketplace, looking for specific things and studying in one day. And it sounds like a fairy
45 00:08:22,710 --> 00:08:29,430 tale, but it really is you'll have an epiphany where all of these things will suddenly make sense to you. And you'll know what type of trader you want to be.
46 00:08:29,850 --> 00:08:42,750 And what's even better is you actually know what setups digital like it's one thing for me to say I like a four hour turtle suit, sell into a bearish order
47 00:08:42,750 --> 00:08:52,230 block that scene on a daily chart. Well, that might be a setup that you can't wait for. Okay, it may require you a lot more patience than you have to do that.
48 00:08:54,390 --> 00:09:05,340 That same setup, if it was done on say, for instance, weekly turtle soup sell into a monthly bearish order block. I can't wait for that I would never have any
49 00:09:05,340 --> 00:09:12,240 trading opportunities because they don't happen that often. But if it just happens to be the time when you look at the charts and you see that formation,
50 00:09:12,510 --> 00:09:23,760 and obviously that's your setup, but your pattern or your bread and butter go to Setup, once you understand it, it's applicable on all these timeframes. What
51 00:09:23,760 --> 00:09:32,580 makes the timeframe selection process unique and why it's important for you as a trader to determine how you're going to trade it is because your comfort level
52 00:09:33,030 --> 00:09:43,740 and your psychological makeup as a trader has to align with that. So in other words, your patience level your aptitude and your life. I mean this is be real
53 00:09:43,740 --> 00:09:52,350 about it. Your your life has to allow you the ability to be in front of the charts or at least do the analysis and then execute on an analysis. So when we
54 00:09:52,350 --> 00:10:01,710 look for setups, we have to find setups that are uniquely defined for your specific trading model. And a lot of times We'll say, you know, ICT, you got a
55 00:10:01,710 --> 00:10:02,340 lot of tools, you
56 00:10:02,340 --> 00:10:11,640 have a lot of things that you know, you have a ton of things. Okay? Do we have to know all these things? No, that's the that's the benefit of studying
57 00:10:11,760 --> 00:10:22,110 conceptually and modular things, because you'll quickly ascertain whether or not a specific pattern or concept gels with you, nor does it resonate with you, as a
58 00:10:22,110 --> 00:10:32,490 trader, you're gonna find that some of the systems and things out there and analysis aren't really uniquely attractive to you as a trader, and I experienced
59 00:10:32,490 --> 00:10:44,820 that as a trader coming up. It wasn't it a lot of things out there that I got excited about. But the few things that I did in early, early on my days, it was
60 00:10:45,900 --> 00:10:58,800 Commitment of Traders report accumulation, distribution, things of relating to patterns, I like to patterns, because I want to see specific things that repeat,
61 00:10:58,800 --> 00:11:06,000 because obviously, like anything else, you know, if you can see something coming, you know, obviously, you know what to do, should you see an opportunity
62 00:11:06,000 --> 00:11:16,020 coming. The problem is, is many of the things I was studying, I couldn't find them real time or before they actually came to fruition. So as I refined my
63 00:11:16,020 --> 00:11:26,100 trading model, and specifically dealt with institutional order flow, and price action, then suddenly, it was like the veil was lifted, and I had blinders
64 00:11:26,100 --> 00:11:36,840 removed from my eyes, then I could see setups that made very specific for me formations, and they had specific criteria that I can really define, and make it
65 00:11:36,840 --> 00:11:43,560 very objective about how I trade, which is what I was looking for, as a trader in them, I first started, but when I first started, I was looking at indicators,
66 00:11:43,560 --> 00:11:53,250 thinking I was gonna be the answer. And you probably if you're listening, you probably have had that same feeling like you want to feel informed. You want to
67 00:11:53,250 --> 00:12:01,410 feel like you know what you're looking for. But because you don't, and it's normal for you to not to know what that is, when you first start trading. Even
68 00:12:01,410 --> 00:12:11,460 for some that waffle for the first couple of years, and they still can't find the rhythm, they will sometimes look to an indicator to give them a a reason to
69 00:12:11,460 --> 00:12:20,700 do something. And because of this, they need to be told something outside of their own ability to decide. And sometimes you'll you'll see that the indicator
70 00:12:20,700 --> 00:12:29,460 will lead you to a setup, but then most of the time, it really doesn't. And it's because most of your trades are linked to a mathematically derived indicator.
71 00:12:30,510 --> 00:12:38,460 When we look at setups, we're looking at specifically finding unique characteristics that repeat themselves over and over again in price action.
72 00:12:39,150 --> 00:12:47,040 Because there are generic characteristics and traits and price action that repeat over and over again, they're not limited to any one of these specific
73 00:12:47,040 --> 00:12:58,050 timeframes. So when we look for specific setups, we're going to find a setup that we individually as a trader, like the most the one that we can see easily.
74 00:12:58,410 --> 00:13:07,950 And you're gonna see that while some of them overlap, some of them won't overlap, but they still will give you an opportunity to be in the marketplace in
75 00:13:07,950 --> 00:13:19,500 the right direction. So a Trend Trader, that's one model that a trader can be using all my concepts with your trading only in the direction of the monthly and
76 00:13:19,500 --> 00:13:26,220 weekly charts. So in other words, if the monthly and weekly are indicating it's going to be a bearish marketplace, you're going to only be trading short and
77 00:13:26,220 --> 00:13:33,570 holding on to these positions for a great deal of time. If it's bullish on the monthly and a weekly chart, obviously you're going to look for buy signals, I'm
78 00:13:33,570 --> 00:13:43,650 going to hold them for a great deal time. That is the nature of trend trading. And again, I am not a long term position trader. So while I try that early on in
79 00:13:43,650 --> 00:13:52,560 my career, it didn't fit me and it didn't take them off fancy. So I'm a short term trader. Now a swing trader, which I've done a lot in my early days, but
80 00:13:52,560 --> 00:13:58,500 because I found that it was more of a lower for me to be in the marketplace more than just a couple times a month.
81 00:13:59,910 --> 00:14:08,970 A swing trader, they're trading the daily intermediate term price action. And you're going to see there's a lot of setups that require you to sit on your
82 00:14:08,970 --> 00:14:18,630 hands and wait. And but when they form and you position yourself in them, they offer stellar rewards and a day does go on and on and on and the payouts are
83 00:14:18,630 --> 00:14:27,600 amazing. But again, it requires a great deal of patience. So I can tell you as your mentor, I just don't have a lot of patience for Swing Trading on the daily
84 00:14:27,600 --> 00:14:36,810 chart, it just takes too much time to wait for the setups and for the trades to pan out. I want my money to have velocity. In other words, I want to be able to
85 00:14:36,990 --> 00:14:47,160 put my money at work, let it do its thing, get my return and then compound that returned rate and my base equity and put it back to work again into something
86 00:14:47,160 --> 00:14:53,460 that gives me more velocity. So when I say these things, I'm not trying to talk those individuals that are comfortable trading on a monthly chart or a weekly
87 00:14:53,460 --> 00:15:04,740 chart. I'm trying to tell you that me personally what I found about myself as a trader my defined setups are on a lower timeframe than the daily chart. So it
88 00:15:04,740 --> 00:15:19,020 requires a little bit more dynamic study and time in front of the charts. But that's what my unique model is, I excel in that, that approach to trading, you
89 00:15:19,020 --> 00:15:27,180 again may not be set up psychologically, or emotionally prepared to trade like that. And there's nothing wrong with that. So don't think that I'm trying to
90 00:15:27,180 --> 00:15:39,420 force you into a specific trading model, or a mode of trading, you're going to discover that as we go through these 12 months. Also, you're gonna learn, this
91 00:15:39,420 --> 00:15:48,660 is how I started as a contrarian trader, okay? Now, it doesn't always mean that being contrarian is the right way to go about it. And it doesn't mean that not
92 00:15:48,660 --> 00:15:58,110 being a contrarian is the right way, always as well, there's gonna be times when to be a contrarian trader is optimal. And what you're basically doing is you're
93 00:15:58,110 --> 00:16:06,630 trading reversal patterns at market extremes. So when the markets really gone a great distance higher, and it's been moving higher for a long period of time,
94 00:16:07,290 --> 00:16:15,510 eventually, it's going to hit a specific level or significant level, I should say, usually, and typically, it's on a higher timeframe, it will create reversal
95 00:16:15,510 --> 00:16:23,250 patterns. Now does that mean the market is going to reverse and create a top there it can, sometimes it will. But you can still trade reversal patterns at
96 00:16:23,550 --> 00:16:33,030 extreme moves, or what would be referred to as capitulation where the market just moves extremely, that last bit of burst higher, if it's been bullish, or
97 00:16:33,030 --> 00:16:42,330 that quick, sudden drop, with a great deal magnitude going lower, and that usually makes the low of the move. Generally, sometimes you're gonna see that
98 00:16:43,110 --> 00:16:50,640 there will be times where you want to be contrarian and see that move as a blow off move. And it's the end of the mood. And you can probably get some really
99 00:16:50,640 --> 00:16:58,470 good setups in the form of a reversal pattern. But it doesn't always have to require capitulation, it could be on a short term basis where if you watch the
100 00:16:58,470 --> 00:17:07,860 daily chart, we may go above a previous month's high. And that may be a really good selling scenario to sell short, but not forever, but it's still an
101 00:17:07,860 --> 00:17:18,900 opportunity to trade with. And then for short term trading, which again, that's like selling you trading the weekly ranges, and you're holding for typically
102 00:17:18,900 --> 00:17:28,860 about one to five days in duration. And then obviously setups that are found for the day traders model while you're trading intraday swing trading with exits by
103 00:17:28,860 --> 00:17:30,450 2pm, New York time.
104 00:17:31,230 --> 00:17:42,030 And when we look at this, this is the actual broad brush idea of everything that I do as a trader, everything I've done as a trader, how I excelled from using
105 00:17:42,030 --> 00:17:53,970 long term higher timeframe charts down to what we're seeing here in number five and number four, in respective terms of timeframe, selection, four hour or less,
106 00:17:53,970 --> 00:18:04,680 that's where I excel at, and in my setups are day trading in nature. Now, again, because I have a universal application. And I have experienced doing all these
107 00:18:04,680 --> 00:18:15,990 types of trading, just because I don't be like to trade on a monthly or weekly or daily all the time. What I'm actually telling you is is I can do that. But
108 00:18:16,020 --> 00:18:25,770 because of my appetite for more action. And because I want to put my money at work faster, get a rate of return and then put it back to work again. So I can
109 00:18:25,770 --> 00:18:34,950 turn it in and capitalize on velocity turning my money over and over and over again quicker. I have adopted the mindset that that's my goal. That's my
110 00:18:34,950 --> 00:18:44,760 pursuit. So therefore, to do that more efficiently, and expediently it's going to be in the form of day trading or short term trading. Do not let me convince
111 00:18:44,760 --> 00:18:54,060 you or try to talk you into that's the best way to go. Because it's not, it's not for everyone. So you can still compound your money exceedingly well. Trading
112 00:18:54,060 --> 00:19:05,520 on a higher timeframe charts, believe me, it's not about the setups or the timeframe. It's about your unique alignment with the setups and the timeframe
113 00:19:05,520 --> 00:19:14,340 that meets the happy medium for you as a trader. Because all of us have a family all of us have real world tug of war is that take place. You know some of us
114 00:19:14,340 --> 00:19:22,440 have spouses that require a lot of our time. Some of us are in high maintenance relationships, some of us are in codependent relationships. Some of you are not
115 00:19:22,440 --> 00:19:31,500 in a relationship, okay, some of you are doing things that are going to be a barrier to you doing a lot of trading or a lot of studying. And it's gonna
116 00:19:31,500 --> 00:19:42,420 require you to do a lot more research and action in those higher timeframe monthly and weekly charts in your daily. But if I were to counsel you, and you
117 00:19:42,420 --> 00:19:51,180 were going to listen to me I would suggest that you start in the daily chart, even if you're going to know in your heart of hearts that you're going to try to
118 00:19:51,180 --> 00:19:59,580 be a day trader. Start with a daily chart, because the daily daily chart is going to be a really good Bellwether. It's just the one that will give you
119 00:19:59,580 --> 00:20:08,670 everything You need to know, with a lot of the higher timeframe, reference points. And it also gives you the directional bias that everybody looks for. And
120 00:20:08,670 --> 00:20:15,840 I always ask him by way of email, you tell me how to get in where to where to buy? And how do I know today's going to be up or down? Well, you find that on a
121 00:20:15,840 --> 00:20:23,640 daily chart that tells you everything there. And once you go through this teaching, and the next teaching with institutional order flow, you'll see how
122 00:20:23,670 --> 00:20:31,410 easy daily bias is really, it's not that hard, but the problem is trusting it. That that's the hard part.
123 00:20:39,000 --> 00:20:51,060 Let's just take a look at a monthly chart, okay. And the monthly chart, its premise or its influence in your analysis is it's the long term price action
124 00:20:51,060 --> 00:21:00,780 reference for the largest price action swings and trading, trading setups that take a great deal of time like this, they form in a timeframe that most people
125 00:21:00,780 --> 00:21:10,740 can't bring themselves to trade. But when they unfold the setups that you see in the monthly chart, they tend to unfold over a period of many months. They don't
126 00:21:10,740 --> 00:21:18,840 just happen like little blips on a five minute or one minute chart, they did go on and on and on. Due to the length of time this chart requires to present
127 00:21:18,840 --> 00:21:28,440 setup, trading in the direction of the most recent setup can yield the lowest risk with the highest reward conditions. Now what I mean by that is, when you
128 00:21:28,440 --> 00:21:37,530 have the directional bias, or trend, I'll say it with quotation marks. If you can see where the markets going to most likely go on a monthly chart, you have a
129 00:21:37,530 --> 00:21:48,270 great deal of advantage by trading in that direction, even if you don't catch the actual move that creates the optimal entry for sell or buy. Because it's a
130 00:21:48,270 --> 00:21:58,920 monthly chart, the very nature of its timeframe, it gives us a great deal of time to still capture moves in that same directional bias or in that trend
131 00:21:58,920 --> 00:22:07,410 direction. Now swings that form on a monthly chart, obviously, they can be several hundreds of pips, and it's going to require a long period of time to
132 00:22:07,410 --> 00:22:16,470 unfold. But let's take a look at a sample size of price action on a monthly chart here. Now, obviously, we just turned our charts on, we look at this is
133 00:22:16,470 --> 00:22:24,660 what's recently happened here. And all of a sudden, the very next month we see that, okay, we weren't watching price closely. This particular market was
134 00:22:24,690 --> 00:22:33,690 unclear to us at the time. But right away now we know that there's somebody in the marketplace, moving price around. Okay, go back to the very first teaching
135 00:22:34,020 --> 00:22:41,880 in this mentorship where I tell you to look for markets that want to show a strong willingness to move away from a particular level. Now prior to that down
136 00:22:41,880 --> 00:22:53,190 move, we saw price in a small little consolidation, about 600 pips or so in range. And then finally the market broke down on a monthly basis. So each one of
137 00:22:53,190 --> 00:23:06,960 these candles represents a month's worth of data. And eventually the market takes a greater deal of magnitude lower, it searches lower. And again, take a
138 00:23:06,960 --> 00:23:21,330 look at how many pips this would be in obviously, this is the Euro USD, the move from 5950 We'll call it all the way down to let's say 2450. Okay, that's a lot
139 00:23:21,360 --> 00:23:33,540 of pips, a lot of pips. Now, when you see this, it's rather shocking when you view it in terms of how many pips are available, and it takes you three months
140 00:23:33,570 --> 00:23:45,150 to cover that much distance, or a little bit, well, four months to cover it really. So in four months, the Euro dollar trades, a couple of 1000 pips. Okay.
141 00:23:45,720 --> 00:23:56,100 Now, again, each one of these ranges are specifically a monthly range. In other words, the highest part of that candle for each individual candle is the highest
142 00:23:56,100 --> 00:24:03,870 traded to the most for that particular month. And the low of the candle is the lowest that traded for that month. The opening is where the month started
143 00:24:03,870 --> 00:24:15,210 trading and then it closes the last trading day of the month where it closed. In these individual monthly candles, there are a plethora of setups. Think about
144 00:24:15,210 --> 00:24:21,870 what you have there, you roughly have about 20 trading days without holidays included, you know, things of that nature and Non Farm Payroll, which we don't
145 00:24:21,870 --> 00:24:31,500 trade, but we'll just say roughly, it's about 20 trades 20 trading days per one of these candles. So every one of these bars represents 20 potential trading
146 00:24:31,530 --> 00:24:40,500 days. Now inside of those daily candles, okay, if we were to break them down, okay, there are individual setups as well.
147 00:24:41,760 --> 00:24:54,510 Now also, and I skipped over this, inside of these candles of representation of monthly data. There are typically about four weekly candles and again inside the
148 00:24:54,510 --> 00:25:05,670 weekly candle. There's a great deal of opportunities and so I want you to think like that. When we look at a seed, okay, if I were to show you a seed, say for
149 00:25:05,670 --> 00:25:14,640 instance, a, a apple seed, I placed an apple seed inside your palm. And I asked you what you see, obviously, most of you would have very myopic view and say,
150 00:25:14,640 --> 00:25:22,320 Well, you know, obviously, it's an apple seed. I know, I've seen it before. But I want you to have that view where you see the apple seed, yes, but you see the
151 00:25:22,320 --> 00:25:35,640 potential that apple seed, and how many trees that one seed could produce over time. And with the, the creation of all these new trees, the obvious is that
152 00:25:35,640 --> 00:25:48,990 you'll have more apples. So when we look at these higher timeframes we look at as that's that seed, okay? That really high probability trade scenario exists in
153 00:25:49,140 --> 00:25:57,360 the monthly chart. Now, most of you don't want to spend time on a monthly chart, most of you could care less about what that monthly chart says or what it's
154 00:25:57,360 --> 00:26:07,080 done. Because there's no magic in the monthly chart, because it takes what a whole month to create. The problem is, that's the wrong perspective. You need to
155 00:26:07,080 --> 00:26:15,660 look at the monthly chart and say, hey, you know, what, if the monthly charts moving around, okay, and the monthly charts having sensitivity at specific
156 00:26:15,660 --> 00:26:24,720 levels, who would be moving price around on these levels? And obviously, the answer would be large banks and institutions. So if we have that mindset, we can
157 00:26:24,720 --> 00:26:35,160 go into the monthly chart with a great deal more of appreciation, saying, Okay, well, I know that the markets going to be driven by deep pockets, if it's going
158 00:26:35,160 --> 00:26:43,560 to push price around on the monthly chart, there's a great deal of deep pockets, Smart Money, banks, institutions, they're all going to be in here pushing price
159 00:26:43,560 --> 00:26:51,240 around. So it's in your best interest to understand what that monthly chart is going to do. And what he has already done. In this case, let's just say we
160 00:26:51,240 --> 00:27:01,200 opened up our chart and we saw the Euro dollar here, and this is what we see. So right away without having any other forms or reference, okay, we don't need
161 00:27:01,200 --> 00:27:10,590 anything like that. And this is how I'm trying to tell you understanding price action, it's very pure. I don't need to know where trend is prior to this sample
162 00:27:10,590 --> 00:27:19,080 size and data. I don't need to know what indicators are indicating bullishness or bearishness, I don't need to know that either. I need to know what Crossing
163 00:27:19,080 --> 00:27:28,590 overs of any moving averages took place. I just need to know where has price moved away from it was it it was it was a great deal of magnitude Yes, obviously
164 00:27:28,590 --> 00:27:46,020 we moved away very strongly from consolidation around the 51 or 52 level up to the 5950 level. Okay, so we had about 700 bit range or so. And when we see this
165 00:27:47,010 --> 00:27:58,230 the way I want you to view prices, your eyes goes immediately to that last candle because we understand that smart money is going to sell in up moves they
166 00:27:58,230 --> 00:28:09,240 sold in an up candle cabinet and arrange and then finally it broke down below that up candles low. So now the point is yes, you've missed that boat. The
167 00:28:09,240 --> 00:28:17,370 opportunities missed you couldn't sell short there because we're going to assume that we're now just looking at the chart for the first time you as a trader can
168 00:28:17,370 --> 00:28:27,210 say okay, I know that if it gets back up to that candles low and again, this is the monthly chart I'm going to have a trade and I'm going to define that trade
169 00:28:27,600 --> 00:28:44,790 by way of that specific up candles low. So eventually when price does that we have many months before it actually does it over a year transpires. Now think
170 00:28:44,790 --> 00:28:57,390 about this now over a year transpires before price returns back to that up candles low or that bearish order block, but soon as it hits it, then you have a
171 00:28:57,690 --> 00:29:09,930 setup. Now the question is is when price hits that, okay, it takes a long time to get to that particular level. But as price was trading around that 127 30
172 00:29:09,930 --> 00:29:20,940 level, and eventually it trades through the 130 50 level up through the 132 level. Okay, we have indication that the price is probably going to want to go
173 00:29:20,940 --> 00:29:30,090 back up and there are stops obviously around that 146 level with that big up candle
174 00:29:33,030 --> 00:29:40,980 right here is big up candle right in here. There's gonna be stopped resting above that high. Again thinking about that concept that I gave you what to focus
175 00:29:40,980 --> 00:29:51,120 on now in the September content of this mentorship. So we have this candle breaking above this down candle this bullish candle here all of a sudden now we
176 00:29:51,120 --> 00:30:00,750 have a willingness to zoom to do what we expect to see price try to trade back down into this down candle and it does it here. So we can expect See bullishness
177 00:30:00,750 --> 00:30:10,650 here. So if we see this, we know that there may be some bullishness on the upside, okay? And price may reach up above 60 stops. And if it does that it may
178 00:30:10,860 --> 00:30:21,840 reach back up here to this bearish order block. So, when it finally gets back up at their shorter block, we've had two instances where we can see where prices on
179 00:30:21,840 --> 00:30:30,570 a monthly chart broke down, trade all the way down here, we can see the bearish candle here that was violated on the upside, and then returns back into that
180 00:30:30,570 --> 00:30:40,110 down candle. So we can see bullishness in the form of bullish order block. In that case, we can see that price has a willingness to potentially range expand
181 00:30:40,140 --> 00:30:50,640 up into that return to that bearish order block right over here. But when it does hit this when it finally hits that particular level there. The question is,
182 00:30:50,760 --> 00:31:01,590 where would price likely trade to next? One of the monthly chart, again, this is no different than what you see me do on a 15 minute chart, an hourly chart, or
183 00:31:01,590 --> 00:31:14,370 even a daily chart. But what where would you reasonably expect to see price trade from once it trades at this level here? Well, what's under there, we get
184 00:31:14,370 --> 00:31:28,350 basically equal lows. But look at the bodies of the candles also, to clean way to clean. Now again, think this is a monthly chart folks monthly. If we are
185 00:31:28,350 --> 00:31:37,650 looking at this right now for the first time, and we sit in front of our chart and say okay, I see this level being hit. What could we do with this? Obviously,
186 00:31:37,680 --> 00:31:53,190 we can expect to see price trading lower. But why why lower? Below those lows is going to be what? Sell stops. Now the question is this. Who in their right mind
187 00:31:53,190 --> 00:32:05,760 would have sell stops below that low? And the answer the equate question is is large funds, large funds, long term trend following funds will have stop loss
188 00:32:05,760 --> 00:32:16,200 orders right below that low, they will leave stops in for a very, very long time. And they have lots of money in play. So when the market trades that
189 00:32:16,230 --> 00:32:29,280 basically that 5080 level, and it goes lower and expands lower, it's rushing down to get to those stops that are residing below the 22, the 122 level and
190 00:32:29,280 --> 00:32:37,590 look at that last candle before it blows out the lows here, all these lows in here, that last candle when it hits it, look what it does explodes the run out
191 00:32:37,590 --> 00:32:47,880 those particular stops. Now again, I want to remember remind you that this is a monthly chart. So if we see this, and we can outline where the market may reach
192 00:32:47,880 --> 00:33:06,930 up into, which took a trade duration of six months to unfold, but it took over 13 months to set up. It took 13 months for this, basically the trade up to get
193 00:33:06,930 --> 00:33:16,500 back to an area where we would see a setup form on the monthly chart. But then once the formation comes into fruition, look how many months it takes to unfold
194 00:33:16,500 --> 00:33:28,650 we got 123456 candles or six months. Look how much acceleration there is, it's half the time, half the time it took for this chart to unfold and set up the
195 00:33:28,650 --> 00:33:45,480 setup. And in half the time or basically six months. To get down to the steps in this setup, okay. In this setup, I'm going to ask you a question. What type of
196 00:33:45,480 --> 00:33:56,220 trader Are you? When price was hitting that 5075, the 5080 level or thereabouts? What type of trader would you be there
197 00:34:01,890 --> 00:34:11,280 when price is most likely going to come down and clear out those stops. You have several opportunities to choose from, you can be a position trader, and be short
198 00:34:11,280 --> 00:34:28,560 around that 150 At level 151. And look for a move all the way down to 120 twos. Now think about that. That's enormous amount of time and potential range. Could
199 00:34:28,560 --> 00:34:37,590 you take that trait? Do you have the wherewithal to hold on to it? Personally, I couldn't hold that long. But does that mean I can't trade this idea or these
200 00:34:37,620 --> 00:34:49,170 perspectives on on the Eurodollar? If I can see 51 big figure one North 151 Or we return back to that bearish order block that's remaining here to orange
201 00:34:49,170 --> 00:34:58,950 level. When price is trading there. It's spent to two months giving you an opportunity to get on board. If you see that, and the reasonable expectation
202 00:34:58,950 --> 00:35:08,640 would be okay well there Have some equal lows down and it's probably gonna take a long time to do it. But between the 151 level that will say, and the 122
203 00:35:08,640 --> 00:35:20,070 level, there's our range. So between those two reference points, we have a known range to work within. Now, again, this is a monthly chart. Before all these down
204 00:35:20,070 --> 00:35:30,720 candles form, we have the potential range identified. So we can now break this down. So okay, I already know where price may likely go relative to the monthly
205 00:35:30,720 --> 00:35:42,690 chart. So how can we use this information going forward, and go across all the spectrum of types of trading. Again, it's over 2900 pips for that price swing
206 00:35:43,440 --> 00:35:58,830 2900 Plus, pips. Just take a look at this swing on a weekly chart and refine that more in terms of defining setups for your trading model is that same price
207 00:35:58,830 --> 00:36:05,940 swing, and we're now looking at it on a weekly chart. Now, this is an intermediate term price action reference point. So everything we see here is on
208 00:36:05,940 --> 00:36:14,490 the scale of an intermediate term. So obviously, because it's a weekly chart, it still takes a great deal of time for these things is set up. But it's a lot more
209 00:36:14,550 --> 00:36:25,620 refined. When we break it down into weekly chart, you can see a lot more detail. We can see obviously, when the market trades back up into previous institutional
210 00:36:25,620 --> 00:36:33,330 reference points like this down candle right before the move up, this down candle is a breaker was it breaking, it's breaking the old high here running out
211 00:36:33,330 --> 00:36:44,250 stops, this breaker is lower than this one here. So we're going to have to refer to that well, here's as initial run up, trades up in this range. Right there,
212 00:36:44,460 --> 00:36:52,110 there's a selling opportunity, we already know that the range is potentially going to expand the run out based on the monthly chart that this was where the
213 00:36:52,110 --> 00:37:01,860 liquidity is going to be what kind of liquidity large fund liquidity to the market expands goes lower and consolidates, again, trades lower and comes right
214 00:37:01,860 --> 00:37:09,750 back up into what a bearish order block. So you can expect to see what another opportunity to sell off. Why because you're you're trading in the direction of
215 00:37:09,750 --> 00:37:18,900 the monthly chart. But now you expecting the weekly chart to expand. And it's going to most likely expand down into this level where liquidity will be
216 00:37:18,900 --> 00:37:32,190 resting. We could take this one step further and refine it down into a daily chart. Now obviously, the daily chart is going to be a short term action based
217 00:37:32,700 --> 00:37:42,150 timeframe where you can see all of the intermediate, and you can see the short term highs and lows in the marketplace. But more specifically, you can see how
218 00:37:42,150 --> 00:37:48,900 you can actually frame your short term trades and your day trades. Now again, we're not gonna talk about day trading for this model here. But for short term
219 00:37:48,900 --> 00:38:00,600 trading, we're gonna look at specifics to deal with that. We know that the range is defined from a known high and a known low to highs where that bearish order
220 00:38:00,600 --> 00:38:08,730 block was on the monthly chart. The low at which we're aiming for was those lows on the monthly chart were equal lows, so in other stocks that were resting below
221 00:38:08,730 --> 00:38:16,890 that. So if we know that we can take our fib and lay it across those two reference points. And by doing so we ended up doing what we started grading that
222 00:38:16,890 --> 00:38:17,460 price swing.
223 00:38:18,930 --> 00:38:27,030 So these levels that we have here, these horizontal lines, they're areas at which the market should see new setups formed. Now here's the thing, we knew the
224 00:38:27,030 --> 00:38:38,160 range before it actually traded. So we can anticipate new trading scenarios or ideas to form in our charts, when price trades at this particular level. And
225 00:38:38,280 --> 00:38:49,140 setups will form in close proximity to these levels as well. So every time we see this is the first quarter, lower from the high down to the low. So this is
226 00:38:49,590 --> 00:38:58,560 25% of that range. We see a setup in here. Okay, market trades lower, we go into equilibrium, the market does what it trades lower, comes right back to
227 00:38:58,560 --> 00:39:07,470 equilibrium and expands again, comes back one more time returns into the range, sells off again, market sells off, comes back up, fills in a void sells off
228 00:39:07,470 --> 00:39:16,380 again one more time and closes the hits the terminus of the move. Now think all these things that we've been teaching so far, they're repeating themselves but
229 00:39:16,590 --> 00:39:26,280 the thing is, this was all outlined on a monthly chart. But the trading ideas are refined further by breaking down the monthly chart into a weekly chart and
230 00:39:26,280 --> 00:39:39,180 then weekly chart breaking that down into a daily chart. Now as a Pattern Trader or a setup, seeking trader like you all are there are several things that we do
231 00:39:39,210 --> 00:39:52,410 in the ICT camp. We look for optimal trade entries, which is a simple return back into a known range. That's the only indicator based ideas I like to use and
232 00:39:52,410 --> 00:40:04,680 it's based on fib and returning into a known open range. The the other ones are a Obviously order blocks, and then their stock runs, which we classically called
233 00:40:04,680 --> 00:40:14,160 the turtle soup, which is a false breakout, which is what you're seeing here. Every instance, we see on this chart, we have a short term high here. Now think
234 00:40:14,190 --> 00:40:25,620 inside this shaded area, the monthly chart, we use it to frame what the idea that we're going to go long term lower. As we are in this shaded area until it
235 00:40:25,620 --> 00:40:36,600 ultimately hits the 2175 level or so we're going to be bearish on the marketplace. So we look for what the marketplace on the daily chart to seek
236 00:40:36,600 --> 00:40:47,670 liquidity above old highs. Why would they want to do that? The markets traded lower, this short term high relatively equal to this one here, there's going to
237 00:40:47,670 --> 00:40:58,050 be my stops resting above that short term high, they run above it, and then explodes lower. Okay, we have a short term high here, market trades above it,
238 00:40:58,890 --> 00:41:07,200 and then explodes lower, I want you to notice every single time that the market takes out a short term high just by a little bit and then quickly accelerates on
239 00:41:07,200 --> 00:41:16,290 the downside. Why is that taking place because they're absorbing liquidity on the buy side, they want to pair up their orders to sell into those known
240 00:41:16,380 --> 00:41:23,760 participants that want to they want to buy here with their trailed stop loss in the form of a buy, stop. Because think about if you're short, how do you protect
241 00:41:23,760 --> 00:41:31,170 your position, you put buy stop above recent high. And then typically what will happen is the market will come back and knock you out and you'll start cutting
242 00:41:31,200 --> 00:41:39,480 or the market will move away in your favor. And you can look for another point which you want to lower that stop loss protecting and locking in profit. Well,
243 00:41:39,540 --> 00:41:49,350 what we do is we look for these opportunities in the form of false breaks above an old high with the idea on a higher timeframe chart that indicates that price
244 00:41:49,350 --> 00:41:57,870 may go lower. So this is like a holy grail setup. Where it's absolutely barnburner you get in there and you look for a short term high to be late on the
245 00:41:57,870 --> 00:42:08,580 daily chart. Look how many times it does it in the scope of all these many days. But look at the logical areas at which it does it, it's close to those those
246 00:42:08,580 --> 00:42:18,870 grades that we did on the overall total price swing that we expect to see. It does it here. We have it here. We have it here. We don't see it in here. But
247 00:42:18,870 --> 00:42:32,040 we're going until our timeframe you will see it and then we see another one in here as well. So when we look at price, okay, if you're looking to trade only
248 00:42:32,130 --> 00:42:40,620 stock runs, okay, you first have to know why the stock rom would be necessary, or why it will be influential in terms of price action. And you get that from
249 00:42:40,620 --> 00:42:42,480 the higher timeframe like we showed with the monthly chart,
250 00:42:43,770 --> 00:42:51,540 you hold on to that bias until clearly you're in you're showing that you're wrong and there's this thing could easily turn around here and started trading
251 00:42:51,540 --> 00:43:00,630 all the way up and so getting violently bullish. And that would have obviously make you change gears or at least put pause on the notion you expect to see the
252 00:43:00,630 --> 00:43:09,300 Euro dollar to trade lower. But until it does that, or it hits the terminus or wherever we ultimately think the price is going to go we stay with that mindset.
253 00:43:09,840 --> 00:43:22,680 We stick with it. So if you're not a stop run setup trader in other words, you can't see turtle soup if you don't have the ability to trust that or know that
254 00:43:22,680 --> 00:43:32,520 what you're selling into Okay, is a high probability scenario where it's going to see an explosion in the higher timeframe direction in this case down there's
255 00:43:32,520 --> 00:43:44,160 other things you can trade and they come in way of breakers and bearish order blocks now obviously the whole move starts back here with that monthly bearish
256 00:43:44,190 --> 00:43:53,130 order block that trades up into but look what it does is it comes in a formation of a turtle suit or a false break or run above equal highs taking out the the
257 00:43:53,130 --> 00:44:02,790 buy stops and then what happens the market surges quickly. Okay, then we had that previous turtle soup here but now look say you can't see the turtle soup no
258 00:44:02,790 --> 00:44:11,490 problem there's absolutely no problem this down candle in here right before the move up above the short term high that down candle is a breaker and you'll learn
259 00:44:11,490 --> 00:44:21,900 about that in this mentorship but as price is trading in here and trades back up into the breaker you can now expect to see price trade lower and it does that we
260 00:44:21,900 --> 00:44:29,130 have another breaker in here and down candle right before the move it takes out a previous high so you can't see the turtle soup here no problem see it in
261 00:44:29,130 --> 00:44:37,200 hindsight the markets already moved down here when trades back up into that breaker you can go short well what about if you are optimal trade entry trader
262 00:44:37,620 --> 00:44:44,190 you pull the fear from this high down to this low you'll get a set and I'm setting trades at lower here optimal trading should get short. Okay, then you
263 00:44:44,190 --> 00:44:52,410 have another breaker here you have a down candle right before this move above this short term high. Okay when price trades back up up to here, you get short
264 00:44:52,410 --> 00:45:01,740 at that breaker sell off boom. What about this one here? This is a bearish order block. Last up candle right for this down move returns to that level, sell it
265 00:45:01,740 --> 00:45:12,990 short. And here it is, what you're doing is you're using the higher timeframe, and you're using your defined setup for your model. If you're a trader that's
266 00:45:13,170 --> 00:45:20,940 focusing on being short, you need to identify what pattern you're going to be looking for, it can be one or two. But it's important to know one, you only need
267 00:45:20,940 --> 00:45:32,970 one good pattern. And I only have really technically three, I trade inside of a range. Okay, where I'm pulling back into an exposed range, okay, or if it's
268 00:45:32,970 --> 00:45:43,530 bullish, and it rallies up and wait for the pullback to close in that range. And then I'm gonna buy it again, for selling at a bearish order block, or I'm
269 00:45:43,530 --> 00:45:52,470 selling short, into a run above a previous high for sell stops. I'm only taking three setups, there's only really three setups that I trade, I'm trading inside
270 00:45:52,470 --> 00:46:02,700 the range. If there's nothing that I can see as a violation of old hireable, old low, selling above the previous high if I'm bearish or I'm selling a previous
271 00:46:02,790 --> 00:46:09,660 bearish order block, if I don't believe that it's necessary to go up for those stops. And you'll learn when those conditions are there. Because I know what
272 00:46:09,660 --> 00:46:16,500 you're thinking. That's the thing I need to know ICT that's the one because if it's me trading back to a bearish order block, but it could potentially be a
273 00:46:16,500 --> 00:46:21,270 turtle soup, how do I know which one you're going to learn that, but I gotta give it to you in pieces at a time.
274 00:46:24,420 --> 00:46:33,240 So again, when we look at the market like this, and we have our timeframe selection, and then we have our setups for our particular trading model, and
275 00:46:33,240 --> 00:46:40,530 that model is going to be defined by you over time, no one's going to be able to tell you, this is how you do it. Okay, I'm giving you suggestions. And the three
276 00:46:40,530 --> 00:46:48,060 setups that I particularly trade, you're going to be able to gravitate to one of them. And it may be order blocks. But for some of you the order block is going
277 00:46:48,060 --> 00:46:54,450 to be problematic, it's going to be I don't know which one to trust, but you'll clearly see where the stop runs are. And you'll be able to trade turtle suits.
278 00:46:54,990 --> 00:47:03,450 But maybe you can't do that either. Well, you'll trade in liquidity voids, okay, you'll wait for the price to come back down close in a range. And then you'll
279 00:47:03,450 --> 00:47:15,000 wait for expansion to happen. But the point is, these three forms of discipline that I use for trading, they always exist in all timeframes. And it doesn't
280 00:47:15,000 --> 00:47:22,800 matter if you like order blocks and your best friend or your trading huge studying with and you're comparing notes with, in which you really shouldn't be
281 00:47:22,800 --> 00:47:30,750 doing, by the way, as I say that, and this mentorship. But if you know if you're, if you're seeing other people talk about their ability to do certain
282 00:47:30,750 --> 00:47:40,260 things, and you feel frustrated that they are excelling in and understanding of order blocks, and you are struggling. But you can see the turtle suit run on
283 00:47:40,260 --> 00:47:47,430 stops. That's your pattern, don't force it don't try to hit because order blocks or somebody's showing a lot of trades because they can see the roadblock.
284 00:47:47,820 --> 00:47:55,950 There's no preference over this. It's whatever I see at the time when I turn the charts on. And if there's a void, and it comes back into that void, I know what
285 00:47:55,950 --> 00:48:03,840 I'm going to do, I'm going to look for that run to try to run that previous high if we if we rallied up and we created a liquidity void on the upside, and when
286 00:48:03,840 --> 00:48:10,620 it trades back down to that range, I'm gonna buy it with an expectation is going to make a new high. And that's the only setup I'm looking for. I'm not looking
287 00:48:10,620 --> 00:48:22,560 for 5000 pips, I'm just looking for that known range. And you'll learn all that. But don't think that I'm forcing anyone to be any one particular trader. But you
288 00:48:22,560 --> 00:48:30,630 will learn these three conditions in the marketplace because that's the only three I trade with today. I don't do anything outside of that. I don't trade
289 00:48:31,500 --> 00:48:41,520 overall patterns, I don't trade, you know, all the things that I shared the past, they were all hallmarks of my coming up as a trader. But I don't do all
290 00:48:41,520 --> 00:48:48,870 those things. Today, I only trade these three things and I don't need anything more. In fact, I could just reduce it to one. But because I like a lot of
291 00:48:48,870 --> 00:48:56,940 action. I will look for these three things every single day across the charts and I'll find a setup. And I've seen I've shown it to you I've proven to you on
292 00:48:56,940 --> 00:49:07,890 a daily basis. When you understand these three characteristics and price action, nothing evade you, not a reversal. Not a trend following pullback and not a
293 00:49:07,890 --> 00:49:17,970 expansion out of a consolidation, nothing will evade you, you'll have every thing you need to know and repertoire and a toolbox to trade any market profile.
294 00:49:18,570 --> 00:49:21,240 So with that, I'm gonna wish you good luck and good trading