ICT YT - 2023-03-09 - NWOG - New Week Opening Gap
Last modified by Drunk Monkey on 2023-03-16 11:38
Outline
00:00 - How to locate the new week opening gap.
02:06 - What is the difference between a ict Newick opening gap and a liquidity void?
03:33 - When the market moves away from a gap after repricing into it, it can refer back to it weeks ago.
05:07 - What are the two reference points in this chart?
07:00 - The midpoint of the chart is the low in the casket.
08:53 - What is a New Week Opening Gap? -.
10:48 - How price refers back to the old and new week opening gaps.
13:26 - The importance of having a chart template -.
Transcription
| 1 | 00:00:00,000 --> 00:00:21,720 | ICT: All right, folks, welcome back. This lecture is going to be on my ICT new week opening gap, which is abbreviated in W O G, is this concept that I released |
| 2 | 00:00:21,720 --> 00:00:27,780 | on Twitter in February 2023. And let's get into it now. |
| 3 | 00:00:34,260 --> 00:00:45,900 | Just briefly, as an introduction, this is the Sunday February 5 2023, new week opening gap. And the way you want to locate that is you want to get into a lower |
| 4 | 00:00:45,900 --> 00:00:55,020 | timeframe chart, you don't want to use your daily chart, because a daily chart is going to be using a settlement price that may not be in alignment with what |
| 5 | 00:00:55,860 --> 00:01:07,350 | we're showing you here to us. So you can use a one or five minute chart. And you're going to be using the Sundays opening price which would be represented |
| 6 | 00:01:07,350 --> 00:01:21,000 | here on the fifth of February. And the closing price on the Friday prior. Okay, so there's a difference between these two price points. Here. Okay, so it's the |
| 7 | 00:01:21,000 --> 00:01:33,840 | open on Sunday. And the close on a previous week's Friday. The new measurement, midpoint here, which is consequent encroachment. So that's basically what it |
| 8 | 00:01:33,840 --> 00:01:48,660 | looks like on my chart. And we'll take a look at some more examples of it now. But this is essentially five weeks ago. Based on today's actual date of this |
| 9 | 00:01:48,660 --> 00:02:00,360 | recording, the week after that, next Sunday would be Sunday, February 12 2023. And this is the new week opening gap for it. And here's the closing price on |
| 10 | 00:02:00,360 --> 00:02:10,110 | that Friday, and the opening price on Sunday. And the midpoint here which is consequent courtroom, the difference between the two. |
| 11 | 00:02:16,380 --> 00:02:30,300 | Now the ICT Newick opening gap is a tool that I utilized to give me large fund fair value, meaning that the markets will generally gyrate a little bit higher |
| 12 | 00:02:30,300 --> 00:02:42,150 | timeframe pulling back to old new week opening gaps, whereas everyone knows that there's gaps, okay, I didn't invent a gap on Sunday. But the approach to |
| 13 | 00:02:42,150 --> 00:02:51,780 | utilizing and how the algorithms refer back to it as a point of fair value, it's kind of like when an inefficiency is filled in and reprice to most traders that |
| 14 | 00:02:51,780 --> 00:02:59,430 | are familiar with it. They're trained to think that okay, it's over with now let's move on to the next thing. That's not how the algorithms work. The |
| 15 | 00:02:59,430 --> 00:03:13,590 | algorithms refer to old inefficiencies and old liquidity voids. Now real liquidity void is an absence of any buying and selling. There's no printed data |
| 16 | 00:03:13,890 --> 00:03:24,600 | between two specific price points. In this case, we're focusing on the previous week's Friday close and the opening Sunday's opening price. So if there's a |
| 17 | 00:03:24,600 --> 00:03:34,830 | difference between those two price points, that gap is a real liquidity void. That's a real liquidity void. There's no trading there. So when the market moves |
| 18 | 00:03:34,830 --> 00:03:50,100 | away from that gap, after repricing into it, it can refer back to it weeks ago, a month ago, or more. So what I have learned is by having them on my chart, and |
| 19 | 00:03:50,100 --> 00:04:01,950 | I'd like to have a minimum of five weeks worth of it. And at the time of this recording here, today's date is March 8 2023. I introduced the concept on |
| 20 | 00:04:02,370 --> 00:04:13,770 | Twitter in February 2023. But actually taught my private students about this specific thing here, but I'm bringing in more elements to it because, you know, |
| 21 | 00:04:13,800 --> 00:04:24,240 | we're mentoring publicly now. So there it is. But you want to have at least four minimum four new week opening gaps on your chart for proper perspective of large |
| 22 | 00:04:24,900 --> 00:04:36,060 | fund fair valuation. I like to have five because it keeps a kind of like a, a dynamic four months perspective. So we kind of give you a little bit of an |
| 23 | 00:04:36,060 --> 00:04:51,840 | overlap, not just the blanket four weeks, look back. So using this chart here. Let's take a closer look here at what we've seen for this week. Looking back |
| 24 | 00:04:53,130 --> 00:05:02,250 | four weeks ago, the date would be February 19 2023. And this is a one minute chart. |
| 25 | 00:05:07,590 --> 00:05:17,460 | So referring to Friday's closing price here, and then Sunday's opening price down here. So my candles, when they're green, they're bullish, that means it's |
| 26 | 00:05:17,460 --> 00:05:26,520 | an up close candle. A Black Candle is a down close candle. So we're using the closing price on Friday, the opening price on Sunday. So those two price points |
| 27 | 00:05:26,520 --> 00:05:34,170 | there, there's a difference even though we see a trade back up to it here from the open trade right back up to it, that's normal, you expect you expect to see |
| 28 | 00:05:34,170 --> 00:05:41,670 | that. But once it does that we don't ignore this gap. Like most other individuals in technical analysis, they're familiar with gaps, gaps tend to be |
| 29 | 00:05:41,670 --> 00:05:54,090 | filled. But once they're filled, they're generally discarded. And not me, I hold on to these things, because the algorithm this delivering price will refer back |
| 30 | 00:05:54,090 --> 00:06:08,490 | to these price points, as you'll see here. Now there's two levels annotated. I like to use a array. Okay, so it's kind of like a short trendline, that anchors |
| 31 | 00:06:08,490 --> 00:06:21,030 | to one specific price point and does projects to the right. This is annotating Friday, close price at 4:59pm. Eastern Standard Time. That's the East Coast time |
| 32 | 00:06:21,030 --> 00:06:34,290 | of us. The opening price here on Sunday at 6pm. Eastern Standard Time. So there's our two reference points. And that is the basic new weak opening gap. |
| 33 | 00:06:34,890 --> 00:06:46,230 | We're going to go one step further. And you're going to take your Fibonacci and you're anchored to Friday's closing price. And if the Sunday opening price is |
| 34 | 00:06:46,260 --> 00:06:56,610 | lower, you're going to drag the Fibonacci down to it anchored there and then your 50% level, you're going to note that that's going to be consequent |
| 35 | 00:06:56,610 --> 00:07:05,190 | encouragement, because this is an inefficiency or gap. The midpoint of that is consequent encouragement, if it were an order block, it would be mean threshold. |
| 36 | 00:07:11,010 --> 00:07:23,940 | So this is what a dressed new opening gap will look like the high the low in casket Crusher in the middle. Now, incidentally, I'm looking at this and I |
| 37 | 00:07:23,940 --> 00:07:35,340 | thought about how you could if you want to annotate yours and keep record of what they're referring to where this is being typed in. This can be the actual |
| 38 | 00:07:35,340 --> 00:07:46,860 | Sunday date. So as you can label this on the Sundays date, so when you know which one of the new week opening gaps This is, as you know, in the future, |
| 39 | 00:07:46,860 --> 00:07:54,870 | because we're gonna have multiple on your chart. If you don't have them annotated, it may be a little bit of a hassle to figure out where they're at. I |
| 40 | 00:07:54,870 --> 00:08:03,750 | don't have a problem with that because I write everything down on a notepad. So on my desk, I had very specific levels and they're anchored to by date. But if |
| 41 | 00:08:03,750 --> 00:08:14,010 | you want to be highly organized on your charts, you can set this up as part of your annotation, just read the text or have a trendline or whatever you're |
| 42 | 00:08:14,070 --> 00:08:25,140 | annotating. This, set it up for middle and maybe right justification so that way it would always show on the far right end of the chart. Whenever you're looking |
| 43 | 00:08:25,140 --> 00:08:35,400 | at it, it would show you the the anchor points referencing the date or you can do it this way too. You can do the Friday date here. That and then use a sunny |
| 44 | 00:08:35,400 --> 00:08:45,150 | day for that but I don't like that. Because you may be zoomed in and you might see this level here and it might disorient you because you would expect maybe a |
| 45 | 00:08:45,180 --> 00:08:54,090 | higher level here for consequent curtailment and then the the opposing level of of Newick opening gap so this is a matter of personal preference. I don't really |
| 46 | 00:08:54,090 --> 00:09:03,570 | hesitate I'm just showing you here as a suggestion. So fully dressed and labeled here is a Sunday February 1923 new week opening gap |
| 47 | 00:09:10,500 --> 00:09:22,890 | Okay, and then we have the following week will be Sunday February 26 2023. New week opening gap. Friday's closing price here. Sunday's opening price here |
| 48 | 00:09:23,970 --> 00:09:37,860 | between the two 80% consequent encouragement and incidentally, you can add quadrants. So if you have the low of the new week opening gap, the higher the |
| 49 | 00:09:37,860 --> 00:09:47,790 | new week opening gap, you'd have the 30% based on the FIB midpoint, consequent encouragement and then you can get the midpoint between the high and the 50% |
| 50 | 00:09:47,790 --> 00:09:59,760 | level to give you the upper third, do the same thing down here between 50% and low the lower quadrant so I like to use new opening gaps that are split into |
| 51 | 00:09:59,760 --> 00:10:09,780 | cool orders that I don't need to have the lines there. So whenever I see the midpoint and the high, I can rough roughly see the midpoint here without having |
| 52 | 00:10:09,780 --> 00:10:19,080 | a lemon line on it, because I like to keep my charts clean. But if you'd like to have that line on here in the one down here, you can simply add it as well. |
| 53 | 00:10:24,120 --> 00:10:36,510 | And then bring us up to date with Sunday, March 5 2023. New week opening up Friday's closing price here, Sunday's opening price here, cool encouragement |
| 54 | 00:10:36,510 --> 00:10:42,510 | between these two midpoints here, and there, we can see the complete new opening gap for March 5 2023. |
| 55 | 00:10:48,210 --> 00:10:59,430 | Now once you have this, and you lay it across your chart, you can see how price refers back to those old new weak opening gaps. And he many times are treated as |
| 56 | 00:10:59,430 --> 00:11:12,270 | support and resistance. By having at least four, preferably five, he gives you a rolling 30 days or month look back. Now there's no real limit as to how many you |
| 57 | 00:11:12,270 --> 00:11:21,960 | want to keep on your chart. But I think this is an optimal level here. So we can see what's being referred to and how the market can drive right back to real |
| 58 | 00:11:21,990 --> 00:11:34,380 | fund level valuation for fair value. So it's not just simply a matter of a fair value gap. But we use the newest opening gaps, like fair value. And you can see |
| 59 | 00:11:34,380 --> 00:11:42,660 | how we gyrate from one level to the next, this vertical line here delineate the gap for that particular week. You can see how we've acted as resistance here. |
| 60 | 00:11:44,220 --> 00:11:53,400 | Consolidating around until here, council support, trade through it. And then the new week here, because this one here is that new week opening gap for this |
| 61 | 00:11:53,400 --> 00:12:06,090 | particular week going from this date to the right. Look how price is respecting consequent coachmen of that new week opening gap. And again here, the high and |
| 62 | 00:12:06,090 --> 00:12:17,910 | consequent encouragement. Jackson then trades back down into the new token gap this particular week. It leaves it started new, new week opening gap here. And |
| 63 | 00:12:17,910 --> 00:12:27,570 | look what happens. The market moves away aggressively. So we have a trending day trending week, where we move away from the new week opening gap. So when we're |
| 64 | 00:12:27,570 --> 00:12:38,850 | close to the new week opening gap, we're in range bound. If it has a difficulty moving away, keep going back to it. We're in consolidation, range expansion or |
| 65 | 00:12:38,850 --> 00:12:50,010 | trending is when we leave the new week opening gap. In don't return back to it. You can see we have a nice weekly trend model there. The new week here is he how |
| 66 | 00:12:50,010 --> 00:13:04,290 | he traded into a here support, support. With around resistance moved lower came back up support rallied new week opening gap here and we gravitate back to an |
| 67 | 00:13:04,290 --> 00:13:14,730 | old new week opening gap here. And then finally back down into a previous week's new week opening gap as support. So while you're looking at this chart, it may |
| 68 | 00:13:14,730 --> 00:13:26,940 | not be so obvious to you now but you can see how price or many times gravity back to when or previous week or weeks old new week opening gaps. So it's not |
| 69 | 00:13:26,940 --> 00:13:36,960 | just like we use this weeks and it's we're done. And it's important to have that data on your chart and keep it as a template. So I like to have a chart template |
| 70 | 00:13:36,960 --> 00:13:54,150 | like this where I keep all my new opening gaps for NASDAQ es Dow dollar and for the forex pairs that trade with Euro dollar and POUND DOLLAR. So it's really |
| 71 | 00:13:54,150 --> 00:14:06,570 | easy to manage. You're on Fridays soon as the market closes or in the evening time and just go and put up a re you know trendline here right on the closing |
| 72 | 00:14:06,570 --> 00:14:14,670 | price on Friday, and then wait for Sunday's opening. As soon as you get Sunday's opening tick that opening price tracking level measured difference between |
| 73 | 00:14:14,670 --> 00:14:22,230 | Friday's closing price and Sunday's opening price get your Costco encouragement level annotated and you're done. You're ready real quick. It's easy to update |
| 74 | 00:14:22,230 --> 00:14:30,900 | and manage and then save your template once it's done. So then you can readily just pull this information out real quick whenever you load up the template. Now |
| 75 | 00:14:30,900 --> 00:14:47,820 | I just loaded mine and save it as new week opening gap and W O G hyphen actual. Now why do I say actual your homework assignment is to use the opening price on |
| 76 | 00:14:48,690 --> 00:15:06,570 | Monday at 930 for ES and use the Friday closing price at 459. That is a another new Opening gap. You're not factoring in Sunday's trading at all. So there's two |
| 77 | 00:15:06,780 --> 00:15:18,480 | approaches to using new week opening gap. Actual is the actual opening on Sunday because there's trading going on there. We have new week opening gap actual |
| 78 | 00:15:18,510 --> 00:15:30,840 | where it's Friday Friday's close price to Sunday's opening price. Then we have new week opening gap, which is simply what Friday's closing price at 459 and 930 |
| 79 | 00:15:30,870 --> 00:15:45,390 | opening price on Monday. Having those two, you're gonna have two templates now. You're going to be able to see different new week opening gaps and how fair |
| 80 | 00:15:45,390 --> 00:15:54,990 | valuation is utilized throughout the week and weeks and across a spectrum of at least a month or so. So there's your homework assignment, get into your charts, |
| 81 | 00:15:55,320 --> 00:15:58,800 | and I'll talk to you next time. Until then, be safe |