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31-ICT Mentorship Core Content - Month 4 - Reclaimed ICT Orderblock

Last modified by Drunk Monkey on 2022-09-09 12:49
1 00:00:33,840 --> 00:00:46,500 ICT: Welcome back, folks, this is teaching 3.4 of eighth of December 2016, ICT mentorships content, we're dealing specifically with the reinforcing order block
2 00:00:46,500 --> 00:00:57,120 theory and reclaimed blocks. Okay, we're gonna be looking at the market maker by model first. And what this essentially is, is when the market drops down and has
3 00:00:57,120 --> 00:01:06,510 a price swing lower, reaching into a higher time frame or intermediate term support level. And that support level can come in the way of an old high can
4 00:01:06,510 --> 00:01:18,060 come in in the way of the old low, it could be a bullish order block, it could, it could be a filled a void, or closing in on a fair value gap. Any one of those
5 00:01:18,060 --> 00:01:27,660 things could lend well to a price support level. But the idea is we're going to be anticipating that market move lower, and you can anticipate it and watch it
6 00:01:27,660 --> 00:01:38,040 go lower and be short. Or if you look at it, and move has already transpired. If you notice, you have seen the decline down to support level, we can start
7 00:01:38,040 --> 00:01:49,230 looking at specific levels to watch for reclaimed order blocks. First, we have to understand the sell side of the curve on a market maker by model. That's the
8 00:01:49,350 --> 00:01:58,740 drop down into that support level. Before we see the move higher, the market makers are going to be scaling in early so they're going to have areas at which
9 00:01:58,740 --> 00:02:07,830 they start buying early because their positions are much larger than us as a retail trader, they require a great deal of movement in time to price in their
10 00:02:07,830 --> 00:02:18,000 orders, because it can't facilitate their entire order on one transaction one specific move from a level they have to scale that position in and that's in the
11 00:02:18,000 --> 00:02:32,550 form of hedging. As the price drops down into the lower level support, they're going to be building in more positions. And you'll see as you watch price go
12 00:02:32,550 --> 00:02:42,900 lower and lower, there'll be small little transactions that cause the market to create short term little lows in the market. As the market moves lower, every
13 00:02:42,900 --> 00:02:52,260 time we see a small little bounce in price action, that is a minor displacement showing that there was new accumulation being taken into the marketplace. In
14 00:02:52,260 --> 00:03:03,270 other words, the smart money is actually a killing new long positions. You have to have the understanding that that lower level support its reaching for is
15 00:03:03,270 --> 00:03:13,200 going to be the ultimate price level, it's most likely going to have its impulse price swing away from prior to that low being formed. Like I said there's going
16 00:03:13,200 --> 00:03:24,420 to be initial short term rallies that take place. Many times traders that are looking at those as entry points, they end up getting stopped out because what
17 00:03:24,420 --> 00:03:34,350 you're doing is they're piggybacking on an entry that is based on a hedging motive on the market maker. So as the lows keep creating lower lows, but every
18 00:03:34,350 --> 00:03:42,780 time the price makes a smaller short term move higher. We're going to be referencing that last down candle because that's a bullish order block. But it's
19 00:03:42,810 --> 00:03:49,920 occurring, we're watching the bullish order blocks or the down candles right before a small little price movement higher during the sell side of the curve.
20 00:03:50,160 --> 00:04:00,480 Now there's this market maker by model, the curve is basically a price swing lower that trades higher. That's all market maker by profile is or market maker
21 00:04:00,480 --> 00:04:13,080 by model, it's just understanding that the markets going lower to go higher. Eventually, we'll see the price move higher off of a major support level. And
22 00:04:13,080 --> 00:04:22,020 we'll start seeing the buy side of the curve coming their way. The market will start pricing new higher highs. And as it does, we're gonna be focusing on those
23 00:04:22,500 --> 00:04:30,900 old down candles during the sell side of the curve. Every time there was a bullish order block that was created on the major price swing going lower end it
24 00:04:30,900 --> 00:04:40,230 saw a little bit of a minor movement higher. That has indicated that there was hedging going on and that down candle is what we're gonna be looking to reclaim
25 00:04:40,680 --> 00:04:50,850 or watch price recapitalize that old order block now that we're on the buy side of the curve. Every new buying opportunity is going to be matched up to the
26 00:04:50,850 --> 00:05:01,830 previous down candle while the price was dropping earlier on the sell side of the curve. And ultimately everything will match up With the down candles on both
27 00:05:01,830 --> 00:05:11,970 sides of the market maker by mood model so what is a bullish reclaimed block is a candle or bar that was previously used to buy price in a short term bounce
28 00:05:11,970 --> 00:05:23,250 confirms minor displacement. In the buy side of the curve, these old blocks or down candles will be reclaimed for new Long's. So let's take a look at what it
29 00:05:23,250 --> 00:05:24,630 looks like in price action.
30 00:05:26,100 --> 00:05:37,200 Okay, we see the market dropping down from November 24 into November 29. Okay, so we have a market maker by model or the markets going down to go hire see here
31 00:05:37,200 --> 00:05:48,330 this down candle on the buyer side of the curve right here. This down candle right before this movement up here, just placement shows that this was an actual
32 00:05:48,360 --> 00:05:57,300 hedging, but they were buying early and the market drops lower. Okay, once it makes its low here, you can see the price didn't in fact come back down to this
33 00:05:57,330 --> 00:06:08,160 obscene down candle right to it here and was reclaimed or they recapitalized this old order block here and price started to move higher. The next level is
34 00:06:08,160 --> 00:06:18,420 here, this movement down prior to this displacement here. All of this movement here and is down candle is a bullish order block on the right side of this low.
35 00:06:18,570 --> 00:06:25,560 Now we're on the buy side of the curve. And that's what this movement is here hits it right to the PIP and then price moves higher. So there they are two
36 00:06:25,560 --> 00:06:39,030 examples of reclaimed bullish order blocks. Okay, now we're gonna take a look at the market maker sell model. This is just the same thing just in reverse, where
37 00:06:39,030 --> 00:06:48,120 we're anticipating the market to trade higher to go lower. You may not see it happen before the fact you may notice that the markets making a high and you
38 00:06:48,120 --> 00:06:59,580 expect to see a sell off. So we can use this information just by focusing on the buy side of the curve. Every up candle that sees a displacement or short term
39 00:06:59,580 --> 00:07:09,090 decline confirms that there are hedging underway. That means that they're selling short early in market makers you're selling into these rallies, when we
40 00:07:09,090 --> 00:07:18,450 get to the sell side of the curve. Every single time we see the market trade back up into a up candle or bullish candle right for the down move during the
41 00:07:18,450 --> 00:07:27,450 buy side of the curve. That bearish order block is going to be reclaimed. And you can take that as a new short and again matching up during the buy side of
42 00:07:27,450 --> 00:07:36,150 the curve. While price is being built up into a premium. The market makers are actually going to hedge into that rally selling short they have deeper pockets
43 00:07:36,150 --> 00:07:46,230 than us. They can do this for a longer period of time. And as they do this, they're pricing in more short positions. We can match that up and see it like X
44 00:07:46,230 --> 00:07:55,920 ray vision into price action, looking at every single up candle that has a small displacement or short term decline that's confirming that there was hedging
45 00:07:55,920 --> 00:08:03,750 underway and again, we understand that market makers and smart money they're the only ones that can move price around. So if there is a displacement in price and
46 00:08:03,750 --> 00:08:13,950 we see bearishness after an up candle, we can assume that this is going to be evidence that they have been hedging and selling short early when we get to the
47 00:08:13,950 --> 00:08:25,950 high and we climax there and start trading softer and going lower every time we read trade back up into that old previous up candle on the on the buy side we're
48 00:08:26,280 --> 00:08:36,330 to the right of the high that's already formed we can now take new shorts at these old bearish order blocks everything matching on the buy side of the curve
49 00:08:36,360 --> 00:08:48,960 to the sell side of the curve. So again, in summary, a bearish reclaimed order block is a candle or bar this was previously used to sell price and a short term
50 00:08:48,960 --> 00:08:59,430 decline confirms minor displacement in the sell side of the curve these old blocks will be reclaimed shorts or new entries for short positions. Alright,
51 00:08:59,430 --> 00:09:09,990 take a look at this chart we'll take a look at the example of a market maker sell profile and using the reclaimed or block we're gonna be looking at the sell
52 00:09:09,990 --> 00:09:18,690 side of the curve or to the right of the high and we're gonna be focusing on every up candle that showed a willingness to see price drop during the buy side
53 00:09:18,690 --> 00:09:33,210 of the curve or to the left of the highest form. You see here the last beefy candle right before this drop down price trades up into it here and sells off to
54 00:09:33,210 --> 00:09:43,260 nested next example is this up candle here which would be a bearish order block will be reasonably seen as in the free tutorials you would think that this was
55 00:09:43,260 --> 00:09:51,240 probably a bearish indication to start looking for lower prices. It doesn't do that here it trades through it, but we see a climax Hi. So now we see price
56 00:09:51,240 --> 00:10:04,140 doing what it trades up into this up candle. This is a new short another example here this last up Candle here, price trades up into it here, very handsomely,
57 00:10:04,140 --> 00:10:15,090 sees that as a displacement lower here. So he started hedging here. This is a selling short opportunity to see the completion of the market maker sell
58 00:10:15,090 --> 00:10:15,600 profile.
59 00:10:16,890 --> 00:10:28,260 So again, in summary, we use the market maker buy and sell models to be able to match up old order blocks during the buy side and the sell side of the curve.
60 00:10:28,650 --> 00:10:42,240 And we wait for that reclaimed mechanism that takes place where the market makers will use the same reference points and facilitate new positions. We'll
61 00:10:42,240 --> 00:10:48,630 build more on this idea as we go through the coming months of material. And you'll see examples of it before the fact and I'll be able to map it out for
62 00:10:48,630 --> 00:10:56,850 you. But for now, study these examples and also go through your charts and find where you can see during price rallies like this and declines, map out all of
63 00:10:56,850 --> 00:11:04,440 the up candles and during the decline side of the marketplace. You'll see that there's wonderful opportunities to get short that you would otherwise not
64 00:11:04,470 --> 00:11:07,860 noticed. Until next time, I wish you good luck and good trading