81-ICT Mentorship Core Content - Month 9 - The Sentiment Effect

Last modified by Drunk Monkey on 2022-10-10 09:33
1 00:00:11,160 --> 00:00:19,470 ICT: Okay folks, welcome back. This is the first lesson of May 2017 content from ICT mentorship. This month we're teaching the st amplified day trading and
2 00:00:19,470 --> 00:00:24,240 scalping this teaching is specifically dealing with the sentiment effect
3 00:00:29,880 --> 00:00:40,440 okay, what are buying or selling probability to the highest? Well for day trades as we're specifically teaching in this month, the use of the Asian range and the
4 00:00:40,440 --> 00:00:51,090 opening price or key for day trades as we're teaching in this month, the use of the Asian range and opening price or key bearish short days, or when you're
5 00:00:51,090 --> 00:00:59,760 looking to sell short. Ideally, you're going to be looking for a move above the opening price and or the Asian range high. When you're looking to go long. On
6 00:00:59,760 --> 00:01:08,370 bullish days, ideally, you're gonna be looking to go long below the opening price and or the Asian range low. Now the market will have a short term shift in
7 00:01:08,370 --> 00:01:17,910 sentiment, and less informed traders will chase price on the impulse or the initial swing interconnect. This is classically known for my teaching as the
8 00:01:17,910 --> 00:01:28,350 Judas swing, where the market goes into a projection a state that's opposing the general direction of the close of that particular day. Focusing on strict
9 00:01:28,350 --> 00:01:37,980 conditions, like daily and or for our direction based on institutional order flow, and combining the PD array matrix for the next level objectives. This will
10 00:01:37,980 --> 00:01:52,650 provide you the highest probability setups. We wait for opposing market directions for high odds setups. Now we're looking at order flow that's bearish.
11 00:01:53,100 --> 00:02:01,110 On the example here in our chart. On the left hand side, if order flow from an institutional basis on a daily or four hour is suggested to be bearish or going
12 00:02:01,110 --> 00:02:13,680 lower, what we're looking for primarily is a move above the Asian range high and away from the opening price. Smart Money sells above the Asian range high when
13 00:02:13,680 --> 00:02:22,920 institutional order flow is bullish on the daily and or for our chart. smart money buys below the Asian range low and below the opening price. Now you're
14 00:02:22,920 --> 00:02:32,430 probably saying to yourself, Well what is the opening price, it's going to be either zero GMT, the opening price early in the day, if it's been in
15 00:02:32,430 --> 00:02:42,570 consolidation very close to that same area. In other words, if the range from the zero GMT hour hasn't produced much of a range on the upside or downside, you
16 00:02:42,570 --> 00:02:53,280 can still incorporate that opening price as well. But in this teaching, we're focusing primarily on the midnight candle in New York. Conversely, when
17 00:02:53,280 --> 00:03:03,060 institutional order flow is bearish, on a daily under a four hour chart, the market typically will go above the Asian range high and that will many times
18 00:03:03,060 --> 00:03:12,030 suck in street money. And they will be buying above that on a breakout. When institutional order flow is bullish on the Dalian door for our chart, the moves
19 00:03:12,030 --> 00:03:18,060 that go below the Asian range, many times trip Street money into selling short that puts them in on the wrong side.
20 00:03:23,580 --> 00:03:35,250 Okay, bye conditions for a proper setup for long entries. Now what we're gonna be referring to is IP does suggestion based on the daily or minimum for our
21 00:03:35,430 --> 00:03:46,020 discount array, it must be in play. In other words, on a daily chart and our four hour chart, price has recently respected or traded down into a discount PD
22 00:03:46,020 --> 00:03:55,080 array, and it's showing a willingness to support price. Nor do we have we had a reaction of some sort. So if we see that on a daily and four hour and
23 00:03:55,080 --> 00:04:07,290 institutional order flow is bullish. We have a very high odds condition for a buy in a day trade. There's a sufficient range and pips between market price and
24 00:04:07,290 --> 00:04:16,410 opposing premium array found on the daily and or minimum for our chart. What am I suggesting here? Is there enough of a range read profit, if you want to be a
25 00:04:16,410 --> 00:04:27,000 buyer today based on the fact that we've traded down to a daily and our minimum for our discount array? If we have done that, the conditions are the stage is
26 00:04:27,000 --> 00:04:37,260 set for a potential buy or up close day. By itself it doesn't mean much at all. But if there's a sufficient range between the current market price when you're
27 00:04:37,260 --> 00:04:47,070 looking to take the trade and the opposing premium array that will be found on a daily and or four hour chart in other words, is it like 5060 pips? That's a
28 00:04:47,130 --> 00:04:58,980 that's a healthy range for a day trade. Anything less than 40 pips, it's a scalp it can be done, but I like to see 50 to 60 pips preferably for my own for my own
29 00:04:58,980 --> 00:05:14,250 tastes. price declines under the opening price. And again, this is the midnight candle in New York and the Asian range low. And ideally to decline on the Asian
30 00:05:14,250 --> 00:05:26,460 range low will be to a logical discount array on a 15 minute timeframe. Typically place will not spend much time at the discount array on the 15 minute
31 00:05:26,460 --> 00:05:39,780 chart. Expect price to sharply trade higher away from the 15 Minute discount array. The longer price stays or hovers near that 15 minute discount array, the
32 00:05:39,780 --> 00:05:47,820 odds drop off precipitously, we want to see immediate response because the banks won't keep that price level at a discount very long if it's going to be good.
33 00:05:49,440 --> 00:06:02,520 And short term sentiment will be most bearish at the time when we enter our long trades. For sentiment purposes, I use a 10 period Williams percent R. And I plot
34 00:06:02,520 --> 00:06:11,250 that on my 15 minute timeframe. As you can see in our chart here, it gives us a very clear, discernible measure of sentiment. But we don't look at the
35 00:06:11,250 --> 00:06:22,170 overbought oversold conditions that this indicator usually is over referred to the conditions really are, we're looking at price primarily. And if we get a
36 00:06:22,170 --> 00:06:34,590 sentiment Confluence as we see here, this gives us a higher odds that we probably are going to be on the right side of the marketplace. Why the price go
37 00:06:34,590 --> 00:06:43,110 up. As you saw throughout this week, I mentioned that we will probably see the weekly low form on Thursdays New York session, price came down hit the sell
38 00:06:43,110 --> 00:06:54,720 stops on two bases. They hit the intraday stops on the New York open 830 employment number, but they did it before the numbers released. And I mentioned
39 00:06:54,720 --> 00:07:01,650 during the live session that that day on Thursday, that that's not good. And they're probably pricing in the low of the week. And it's also that sell stop
40 00:07:01,920 --> 00:07:14,040 discount pdra Old low on the daily chart. And it rallies up through to fair value gaps and it hit the gap resistance on the second upper most fair value gap
41 00:07:14,160 --> 00:07:27,870 stopping dead in its tracks there. So we had a draw on the daily chart up to a premium array in the form of two fair value gaps pricing off of the accumulation
42 00:07:27,870 --> 00:07:41,280 of those cell stops with the weekly template, Thursday's low and the week forming. And we see that subsequent price move again that New York session
43 00:07:41,280 --> 00:07:50,310 Thursday weekly low was defined before the fact so we're seeing something in this teaching that would otherwise be looked at as hindsight cherry picking but
44 00:07:50,310 --> 00:07:53,160 we watched it unfold in live conditions
45 00:07:58,980 --> 00:08:11,790 self conditions proper setup for short entries. Again if to suggest a daily and or minimum for our premium array is in play. There is a sufficient range and
46 00:08:11,790 --> 00:08:23,970 pips between the market price and opposing discount array found on the daily and or minimum for our chart. Price rallies above the opening price in midnight New
47 00:08:23,970 --> 00:08:37,320 York handle and the Asian range high. Ideally, the rally above the Asian range high will be to a logical premium array on a 15 minute timeframe. And typically
48 00:08:37,320 --> 00:08:48,420 price will not spend much time at the premium array on the 15 minute timeframe. We expect price to sharply trade lower away from the 15 Minute premium array.
49 00:08:50,550 --> 00:09:00,420 The longer price stays or hovers near the 15 Minute premium array, the odds fall off precipitously. Short term sentiment will be the most bullish at the time
50 00:09:00,420 --> 00:09:14,490 when we enter our short trades. In this example here, using a 10 period Williams percent are for sentiment purposes. We can see at a time when a bearish order
51 00:09:14,490 --> 00:09:26,880 block was traded up into a range Asian range high. We had market sentiment most bullish and it created the two subsequent highs of the day in price moved lower.
52 00:09:27,300 --> 00:09:37,080 This Paragon is the dollar Swiss. This is in concert with our bearish idea after that gap was filled on the dollar index for this week's analysis. That's why
53 00:09:37,080 --> 00:09:49,110 this pair had such a significant move lower and why this pair respected the outlines that we're giving you here for the teachings and on its daily chart for
54 00:09:49,110 --> 00:10:00,690 the dollar Swiss. We traded up to a rejection block on Thursday. Friday we opened rallied above the Asian range high and traded down to fill in In the
55 00:10:00,690 --> 00:10:11,670 discount array, which is in this case, the fair value gap seen on the daily chart. And as you can see here, before Friday's close, the gap was filled. So
56 00:10:12,120 --> 00:10:22,230 when we're looking at day trades, notice that there's a specific criteria here that I like to use. Now, every day, there isn't going to be a scenario that
57 00:10:22,230 --> 00:10:30,870 provides this as a entry. It won't give you an opportunity every single trading day, and that's the purpose. Day trading is not an everyday trading. Okay, I
58 00:10:30,870 --> 00:10:37,290 don't think there's any reason why every single suit every single trading day that you should be in there, trying to find something unless you're practicing
59 00:10:37,290 --> 00:10:50,580 in looking for concepts to be reinforced in just looking at general price action. I think you should be aware that while that study is profitable, it
60 00:10:50,580 --> 00:11:00,690 doesn't equate to profitable everyday trading. Okay, so when we teach in this month, the 20 pips per day session again, that's not an enticement for you to go
61 00:11:00,690 --> 00:11:10,320 in every single day trying to look for 20 pips. But there are going to be conditions that teach that help you find 20 pips, generally in something. But
62 00:11:10,620 --> 00:11:21,060 again, I don't want to try to you build in this idea that you need to be a trader Holic, because it's not a good healthy lifestyle as a trader it is, it's,
63 00:11:21,090 --> 00:11:33,180 it's all in consuming your time and your energy and it doesn't bode well for long term success, you end up becoming PIP drunk. That's basically what I called
64 00:11:33,180 --> 00:11:47,190 it years ago. And I actually fell victim to that. So I don't want to give those same poor characteristics as a trader, new to you, or even imply that you won't
65 00:11:47,190 --> 00:11:54,840 be subjected to the same thing you would be if you go through that same process of trying to trade every single day. Number one, the more you trade, the more
66 00:11:54,840 --> 00:12:02,040 likely you're gonna get a loss, the faster that next loss is going to come. And if you're trying to trade every single day, chances are you're probably going to
67 00:12:02,040 --> 00:12:12,450 build a false sense of your ability. And the worst thing that can happen is you get a series of good strings of wins. And it makes you think that you're way
68 00:12:12,450 --> 00:12:20,700 better than you really are. And the market has a tendency to go into a dry spell. And what you might think is in the charts today, may not be there
69 00:12:20,700 --> 00:12:30,240 tomorrow or the day after. So what we're looking for, as outlined in this specific teaching, using sentiment and a role based idea about the Asian range.
70 00:12:31,320 --> 00:12:40,470 This helps us ferret out the better trades. We won't get this condition every single trading day, but the days that we do, those are the days that this
71 00:12:40,470 --> 00:12:47,220 highest probability for day trading are going to be in your favor. Until the next lesson, I wish you good luck and good trading