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ICT YT - 2025-01-21 - Live Execution NQ PreMarket Turtle Soup Short

Last modified by Drunk Monkey on 2025-04-03 12:09
1 00:00:00 --> 00:00:14 ICT: Good morning, folks. This is Michael, so I'm going to be looking at
2 00:00:14 --> 00:00:21 shorting the NASDAQ. We're looking at a two minute chart here, simply because
3 00:00:21 --> 00:00:23 that's where the inefficiencies are obvious. For me,
4 00:00:25 --> 00:00:31 I'm going to set a limit to sell short inside of a
5 00:00:31 --> 00:00:35 sell side of balance, buy side and efficiency. I'll note that in a moment,
6 00:00:35 --> 00:00:41 it's also aiming for the sell side liquidity pool resting relative equal
7 00:00:41 --> 00:00:42 lows right here.
8 00:00:47 --> 00:00:54 Okay, so there's my target and my stop loss. Stop Loss is above the first
9 00:00:54 --> 00:00:58 candle in the city, which I'll note for you here. I'm including the volume
10 00:00:58 --> 00:01:01 imbalance. You'll notice that at the lower end of it.
11 00:01:09 --> 00:01:14 And now that we're back in side of it, the limit order to be short, one
12 00:01:14 --> 00:01:19 contract has been filled. If it can go to consequent encouragement of that
13 00:01:19 --> 00:01:27 city, I'll be interested in selling more, annotating the buy stop liquidity
14 00:01:27 --> 00:01:33 rate, so that liquidity has been purged. So the market should explore lower,
15 00:01:33 --> 00:01:36 looking back into yesterday's regular trading hours. So
16 00:01:43 --> 00:01:44 okay, I'm adding there
17 00:01:45 --> 00:01:49 just around the continent, encroachment. Gotta fix this. This isn't where I
18 00:01:49 --> 00:01:54 wanted it on the top left, and we'll make it a little bit bigger so we can
19 00:01:54 --> 00:02:00 see it. Okay? So essentially, it's a turtle soup and it's a deferred entry.
20 00:02:00 --> 00:02:11 I'm all
21 00:02:11 --> 00:02:19 right, so presently short two risk is defined at the high of the city.
22 00:02:22 --> 00:02:30 And again, aiming for the sell side liquidity down here. This is kind of
23 00:02:30 --> 00:02:38 like a classic setup where we've already ran out liquidity prior to the opening
24 00:02:38 --> 00:02:40 bell at 930 Eastern time.
25 00:02:42 --> 00:02:46 So we have a shift in market structure, and I'm adding more here.
26 00:02:47 --> 00:02:51 If I can get four contracts on I'll certainly try to do it. But the
27 00:02:52 --> 00:03:04 opportunity to get a break below the low formed at around 21,006 98 98 that
28 00:03:04 --> 00:03:09 should start to accelerate things as long as you stay in the lower half of
29 00:03:09 --> 00:03:15 that city. That's noted here. Once we break that low, magnify this a little
30 00:03:17 --> 00:03:22 bit, see the bodies of the wicks better. Okay,
31 00:03:23 --> 00:03:28 so if we can see that that low I'm having the limit order to cover the
32 00:03:28 --> 00:03:32 short at again, was referenced on the relative equal lows.
33 00:03:32 --> 00:03:33 So don't lose sight of that. So
34 00:03:44 --> 00:03:50 I'd like to see it break below that swing low that's just recently formed,
35 00:03:53 --> 00:04:01 and then it can work back up and touch the bottom end of that city again. And
36 00:04:01 --> 00:04:04 I'll annotate the inversion fair value gap.
37 00:04:06 --> 00:04:10 Now that I think it's validated,
38 00:04:18 --> 00:04:24 we're going to look here at the i time here.
39 00:04:27 --> 00:04:34 Notice the run higher to take out the buy side started at 7am that's classic
40 00:04:34 --> 00:04:36 pre market session activity.
41 00:04:41 --> 00:04:42 Now in a perfect world,
42 00:04:44 --> 00:04:48 we could just start going lower, but because we're just ahead of the 930
43 00:04:48 --> 00:04:53 opening bell, it might want to whipsaw a little bit in here. I don't feel that
44 00:04:53 --> 00:04:59 the stop loss is in jeopardy. Could be hit. If it does get hit, I'll look to.
45 00:05:00 --> 00:05:00 Short.
46 00:05:13 --> 00:05:14 Okay, so
47 00:05:16 --> 00:05:23 one of the things that we move this underneath that low, one of the things
48 00:05:23 --> 00:05:30 that I like to see is the unwillingness for price to get back to the premium
49 00:05:30 --> 00:05:34 side of an array, like, for instance, the sell side imbalance, Python
50 00:05:34 --> 00:05:40 efficiency. That little red box I've highlighted here, we've already worked
51 00:05:40 --> 00:05:44 in the upper half of that. So I want to see it stay in the lower half. If it
52 00:05:44 --> 00:05:49 does go back and trade to it, if it does again, trade inside of that. I'm not
53 00:05:49 --> 00:05:54 really unnerved by that. It's completely permissible because of the opening range
54 00:05:54 --> 00:05:59 beginning in a couple seconds. Usually there's a little bit of a flurry of
55 00:05:59 --> 00:06:07 action, right, like that. Okay, see how quickly it just sharply rejected that.
56 00:06:13 --> 00:06:18 These are all signatures. I like to see when prices giving indication that it's
57 00:06:18 --> 00:06:21 unlikely. On side. Now, all of this might make you nervous. If you're
58 00:06:21 --> 00:06:25 watching it, you're looking at that stop loss, thinking it's going to run up here
59 00:06:25 --> 00:06:31 and jump and hit that and maybe it can. Maybe it might do it. But I'm not
60 00:06:31 --> 00:06:34 thinking that I want to see it break down and make a lower low than that
61 00:06:34 --> 00:06:35 swing low
62 00:06:37 --> 00:06:38 one candle ago.
63 00:06:46 --> 00:06:55 There we go. Now, any retracement back up into the low of that Sibi? If it does
64 00:06:55 --> 00:07:03 so, I'll add one more contract, stop loss. I'm not interested in moving yet.
65 00:07:06 --> 00:07:11 Now I'm looking at about the middle of it, okay, so approximately where my
66 00:07:11 --> 00:07:17 average entry price is for the existing short position, if it can trade back
67 00:07:17 --> 00:07:22 into that same price level, I will try to time that with a market order to
68 00:07:22 --> 00:07:23 Shell one more.
69 00:07:37 --> 00:07:41 I don't think that it's going to give me a chance, so I'm going to just add it
70 00:07:41 --> 00:07:44 there now, so I'm still technically inside the
71 00:07:46 --> 00:07:46 the city,
72 00:07:53 --> 00:08:00 and also the inversion pair value gap Right before the buy side liquidity is
73 00:08:00 --> 00:08:07 taken. I'll take that in a moment. I'm trying to pay attention to what this is
74 00:08:07 --> 00:08:08 actually doing.
75 00:08:22 --> 00:08:26 Like that's nice, and let's take it real heavy in here. And
76 00:08:27 --> 00:08:30 again, you're probably wondering, why am I looking at two minute chart? Is there
77 00:08:30 --> 00:08:34 some kind of secret to that today? No, just the city I'm highlighting here can
78 00:08:34 --> 00:08:40 be drawn out over one two minute candle versus the broken up one minute
79 00:08:41 --> 00:08:46 imbalance. It's got multiple fair value gaps on the one minute chart in the same
80 00:08:46 --> 00:08:49 range that's highlighted here. So that's the only advantage I'm using the two
81 00:08:49 --> 00:08:55 minute chart. So I taught this in the 2024 video lineup on the YouTube
82 00:08:55 --> 00:08:57 channel. So you can go back and listen to that.
83 00:08:57 --> 00:08:58 I made that very clear,
84 00:09:02 --> 00:09:05 once you have a bias, you know you're looking for you know the drawn
85 00:09:05 --> 00:09:08 liquidity, all those things
86 00:09:09 --> 00:09:11 are foundational,
87 00:09:12 --> 00:09:16 but the timing is based on either a five minute, four minute, three minute, two
88 00:09:16 --> 00:09:21 minute or one minute chart, whichever one has the cleanest inefficiency that
89 00:09:21 --> 00:09:23 you can work with define that type of thing.
90 00:09:31 --> 00:09:35 It can touch the lower end of that, but if it trades up inside of that pink box
91 00:09:36 --> 00:09:41 I wanted to see it stay in the lower half. That's very, very critical.
92 00:09:43 --> 00:09:44 And it's also
93 00:09:45 --> 00:09:50 working in the the aspects of this inversion fair value. If I get this
94 00:09:50 --> 00:09:53 thing to drop on the right candle, there you go, I'm.
95 00:10:01 --> 00:10:08 So far, it's a little unorganized, but withdrawal is still very much obvious.
96 00:10:08 --> 00:10:12 The liquidity has been taken on the buy side. Traders that are buying on a
97 00:10:12 --> 00:10:19 breakout, they're caught offside right now. They don't realize it yet right now
98 00:10:19 --> 00:10:21 that there's hoping it's going to move in their favor.
99 00:10:22 --> 00:10:32 So half of
100 00:10:32 --> 00:10:37 that inversion, fair value gap, the one it's orange. I want to see price stay
101 00:10:37 --> 00:10:40 below that as well. So it's a combination of two things. I want to see
102 00:10:40 --> 00:10:44 stay in the lower half of the pink box, which is the city, and I want to see it
103 00:10:44 --> 00:10:48 stay in the lower half of that orange box, which is the inversion fair value
104 00:10:48 --> 00:10:52 cap. So my my thought process is, I'm going to break lower and go below that
105 00:10:52 --> 00:10:54 low right here. That's what I'm annotating. So that candlestick should
106 00:10:54 --> 00:11:00 be the definition of the high of that return back into both city and inversion
107 00:11:00 --> 00:11:01 fair value cut.
108 00:11:06 --> 00:11:12 So if my read on price is accurate, it should be unlikely to trade in the upper
109 00:11:12 --> 00:11:16 half of both of those rectangles I've drawn highlighting inefficiencies I'm
110 00:11:26 --> 00:11:30 that's about where I was filled on that fourth contract. So I want to highlight
111 00:11:30 --> 00:11:36 the midpoint here you can see consequent encroachment. Pretty much nailed it. So
112 00:11:36 --> 00:11:43 I would have added that fourth one when it just was touching the low that. So
113 00:11:43 --> 00:11:47 either way, I would have got that fourth contract on I'm going to sit Pat with
114 00:11:47 --> 00:11:51 what I am right now. I don't want to go anymore, and I'm not going to do any
115 00:11:51 --> 00:11:56 partials. So it's going to be a full pull to sell side liquidity. If I can
116 00:11:56 --> 00:12:05 get it, it starts to break down in here, that'll be a good indication. I want to
117 00:12:05 --> 00:12:10 see a lot of heaviness, big, long, stretched out black candles. So I want
118 00:12:10 --> 00:12:17 to see a lot of desire for price to the probe blower and close in some of that
119 00:12:17 --> 00:12:21 opening range gap that's not clearly defined here, but I'll let you look at
120 00:12:21 --> 00:12:29 your charts in relationship to that idea. I'm trying to keep the annotation
121 00:12:29 --> 00:12:32 as light as possible, because I don't usually put this stuff on the chart when
122 00:12:32 --> 00:12:36 I'm trading. But for the sake of you watching and following along with the
123 00:12:36 --> 00:12:42 logic, where was my premise on entry? Why was my entries, where they were.
124 00:12:43 --> 00:12:47 You're seeing that here. So far, this is exactly what I want to see. I want to
125 00:12:47 --> 00:12:54 see a lot of heaviness here. There's a little bit more. I want to drop that
126 00:12:54 --> 00:12:54 stop,
127 00:12:56 --> 00:12:57 reduce some of the risk. I
128 00:13:00 --> 00:13:04 won't be so interested in chasing with the stop loss, but I want to reduce it
129 00:13:04 --> 00:13:10 now here, and that'll stay with the life of the trade. Now, not interested in
130 00:13:10 --> 00:13:16 moving anything else. It comes back and stops me out. It covers commission
131 00:13:16 --> 00:13:23 costs. It gives me enough for a pizza dinner, and it'll be whatever it is. But
132 00:13:23 --> 00:13:27 I'm more interested in following along with price action. Does it want to reach
133 00:13:27 --> 00:13:32 for that low? And if it does, it might punch through it a little bit further
134 00:13:32 --> 00:13:39 than the limit order is marked. So if it does so, it might not reflect the
135 00:13:39 --> 00:13:45 execution label. So I want to take that in consideration here, and kind of like
136 00:13:45 --> 00:13:49 scrunch the chart up a little bit vertically, so that way, if it does go
137 00:13:49 --> 00:13:49 below it,
138 00:13:51 --> 00:14:02 it should allow me to share that with you. I hate when they do that. It should
139 00:14:02 --> 00:14:06 film. Here you go. Hope you enjoyed it. Take care and be safe. Bye.