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ICT Market Maker Primer Course - 18 - OTE Primer - Intro To ICT Optimal Trade Entry.srt

Last modified by Drunk Monkey on 2022-05-05 14:23
1 00:00:17,250 --> 00:00:31,170 ICT: Okay, folks, welcome. This is gonna be the first video I do as a beginning point origin, if you want to call it that, for my continuing series on the
2 00:00:31,170 --> 00:00:45,420 YouTube channel, inner circle trader. So there's going to be daily entry, in terms of the YouTube channel will have a Monday through Friday video log, so
3 00:00:45,420 --> 00:00:59,400 there'll be something posted. And in October 2017, I'm going to be doing a New York session, live commentary. So I'll be talking about one particular pair per
4 00:00:59,400 --> 00:01:10,800 day, based on personal choice and selection, it doesn't mean there's going to be a setup that comes to fruition every single day, just means I'm gonna give you
5 00:01:10,800 --> 00:01:22,890 an example focusing on one particular pair. And using that as a foundation and understanding your in learning price action. So the first thing I want to kind
6 00:01:22,890 --> 00:01:33,960 of bring the focus to is why everyone starts trading. Obviously, they want to make money. Okay, number one, I'm not promising you that. Okay, because no one
7 00:01:33,960 --> 00:01:45,060 can, the only thing I can tell you is, this is a particular pattern that I first discovered in price action. And it was very easy to spot, very easy to see and
8 00:01:45,060 --> 00:01:55,290 understood the mechanics rather quickly. And I think, from every one I've ever taught, this is the one pattern that most gravitate towards. There's a lot of
9 00:01:55,290 --> 00:02:03,090 different trading patterns out there, especially in my personal repertoire. But truth be told, only have only two setups that I look at. And I'm not going to
10 00:02:03,090 --> 00:02:12,450 give you those particular setups here. But I'm going to be teaching you the generic optimal trade entry from a foundational standpoint, or bare basics
11 00:02:12,480 --> 00:02:24,540 approach to it. Now, right away, much like everyone else has already gone through my free tutorials, they either dismissed it as well, you know, it's too
12 00:02:24,570 --> 00:02:35,340 easy to do simple trading can't be that easy. And no trading isn't technically easy, quote unquote, it makes it difficult this is you have to measure the
13 00:02:35,340 --> 00:02:44,610 amount of risk involved for every setup, and then you have to stick to a trading plan that follows that setup. And even that doesn't guarantee you're gonna make
14 00:02:44,610 --> 00:02:55,470 money. So the author, I'm guaranteeing you here is a solid understanding of what I see in terms of price action as it relates to optimal trade entry, or as it's
15 00:02:55,470 --> 00:03:07,530 themed on the internet. And in my own tutorials, OTE. Okay, just abbreviation for optimal trade entry. Alright, so the first idea is, number one, before we do
16 00:03:07,530 --> 00:03:19,950 anything, I'll kind of like want to remind you all that I did a lecture years and years ago, about how your trading plan is many as some might feel that's
17 00:03:19,980 --> 00:03:32,100 necessary to have, you know, 14 page, you know, treaty, what it is you're going to do, I think personally, once you understand the mechanics of it all, and what
18 00:03:32,100 --> 00:03:41,280 you're doing conceptually, it only needs to be enough to fill the back of a business card. Okay, so you need a short little list of things that you know, by
19 00:03:41,280 --> 00:03:48,960 heart, what's your risk model? How to frame that? What makes your entry? What gives you the conditions in the marketplace that makes you bullish or bearish?
20 00:03:49,470 --> 00:03:57,420 And, you know, how do you execute? And how you manage that trade? And then, obviously, you know, where do you take your profits? So obviously, it's a very
21 00:03:57,930 --> 00:04:12,570 oversimplification on my part, admittedly, I understand that. But my return back to online, I guess, tutelage and teaching is really kind of like, bring it back
22 00:04:12,570 --> 00:04:25,320 in the scope of simplification. Because I have a lot of things that I've taught everyone about trading every asset class, specifically forex. The common
23 00:04:25,320 --> 00:04:34,080 consensus This is because everyone's tried to learn everything I taught, and they tried to apply to every possible scenario and every particular trading day
24 00:04:34,080 --> 00:04:35,580 that they had time to sit in front of the charts, it
25 00:04:35,580 --> 00:04:45,780 doesn't promote, you know, a solid understanding. In fact, it creates kind of like a paralysis effect. So what happens is everyone quickly walks away from the
26 00:04:45,780 --> 00:04:54,330 material thinking, Well, number one, he's just a demo guy because you can't do it. Or because I haven't showed a track record. And it's always been about you
27 00:04:54,330 --> 00:05:02,790 and not about me. So if you take this information, use it. I promise you, you will have greater understanding about price action. And you have right now,
28 00:05:02,820 --> 00:05:10,380 that's the only thing I can promise Now, does that mean you're going making be making any money? No, I can't promise that. Okay, so everything I talked about
29 00:05:10,650 --> 00:05:20,520 is going to be referred to as a hypothetical scenario, because I'm not trying to take ownership of the risk and rewards that you take in using this information.
30 00:05:20,520 --> 00:05:28,860 So this understand that it's for informational purposes only. But I think if you look at it, you'll quickly see that there's something of worth in terms of
31 00:05:28,860 --> 00:05:38,790 studying. So the first thing we're gonna look at, is understanding what makes the market predisposed to go higher or lower. Now, if you recall, for those that
32 00:05:38,790 --> 00:05:47,790 have had that benefit of going through my old tutorials, I had a teaching on selecting key support resistance levels. And it's primarily just marking from a
33 00:05:47,790 --> 00:05:58,260 higher timeframe monthly down into the lower timeframe. So when I say lower timeframe, that would be about before hours, the lowest I'd go in terms of
34 00:05:58,560 --> 00:06:11,010 defining it as a key. Anything less than four hours is too short term to refine that on a large institutional basis. So what I like to look for, is am I taught
35 00:06:11,070 --> 00:06:19,260 on free throws is that if you use the higher timeframe, monthly, weekly, daily and four hour, we'll just leave the four hour off. For right now just focus on
36 00:06:19,290 --> 00:06:29,850 monthly, daily, and weekly timeframes. If you look for key levels, where price has moved away from, you know, what's if prices moved up to a resistance level,
37 00:06:30,300 --> 00:06:41,310 and repelled and went lower, we can reasonably assume that there was a large degree of institutions that had a interest in being short there. And if the
38 00:06:41,310 --> 00:06:49,890 market trades down to a level and bounces off of it and goes higher, we can reasonably assume that there is an institutional basis for that rally to ensue.
39 00:06:50,700 --> 00:06:59,220 Now, without going into great detail, and revisiting everything I've ever done, and trying to compressing into a very short video, just know that that simple
40 00:06:59,220 --> 00:07:09,300 premise of using a higher time frame chart, and these are monthly chart, there's plenty of high probability scenarios that you can find just using a monthly
41 00:07:09,300 --> 00:07:20,550 chart. Now, you don't get a whole lot of setups. But if you're watching a wide array of particular assets, there's always something trading at or near a
42 00:07:20,550 --> 00:07:29,400 monthly level. Okay, and what's a monthly level, an old high an old well, as simple as that. Now, everything I'm going to be teaching and revisiting in the
43 00:07:29,400 --> 00:07:38,610 YouTube channel is all about simplification. Very simple processes, simple ideas, no indicators, no gimmicks, none of those types of things. You don't need
44 00:07:38,610 --> 00:07:48,060 all that stuff, very simple understand price action. The premise behind what makes these things strong is we're looking for the evidence that there's going
45 00:07:48,060 --> 00:07:57,240 to be a institutional sponsorship behind the price move. That means big entities, deep pockets, lots of orders coming in large, sizable orders are
46 00:07:57,240 --> 00:08:06,750 coming in, we're not looking at ladders, we're not looking at little tiny little fluctuations of intraday volatility, we're looking at big, massive telltale
47 00:08:06,750 --> 00:08:13,770 signs that these big boys have pushed price around. And you can see that on the higher time frame. I've said this so many times, if folks would just focus on
48 00:08:13,770 --> 00:08:20,700 these timeframes, it will answer 80% of the problems you're having. Because you're too worried about what's going on in these lower timeframes. Because
49 00:08:21,030 --> 00:08:28,110 you're in enamored by something maybe I've done with the intraday chart and five minute, 15 minutes, something like that, or even one minute chart you do on
50 00:08:28,110 --> 00:08:35,340 social media, everybody's a wizard now. They're showing all kinds of things that they've either done or can do. And that's great, but one minute charts are not
51 00:08:35,340 --> 00:08:42,870 going to decipher what Smart Money is doing. That's just very short term volatility. Now, I'm not disparaging the ability to make money doing that,
52 00:08:42,870 --> 00:08:52,050 because I can do it just like this as well as the next guy can. But what I really want to focus my time on and this is what I taught from 2010 is it really
53 00:08:52,050 --> 00:09:02,370 just a forex but it really goes across all asset classes if you use a higher timeframes on any asset classes you're looking to speculate in or study. That is
54 00:09:02,370 --> 00:09:11,370 where the big money moves are. It's as simple as that it doesn't get any plainer than that. Okay, so we're going to assume for a moment that we assume that the
55 00:09:11,370 --> 00:09:15,720 markets bullish Okay, and we will be looking for the market to trade higher.
56 00:09:17,430 --> 00:09:27,960 Optimal trade entry is really based on buying retracements. Okay, as the market makes a impulse price move higher. That impulse price move has to be
57 00:09:27,960 --> 00:09:36,210 incorporating a break in market structure. And I'll show you what that looks like in the chart. And then what you're doing is you're trying to buy the
58 00:09:36,210 --> 00:09:45,210 retracements lower and the obviously it's very cliche to hear in technical analysis, buy the dips, sell the rallies, okay. If you're, if you're bullish,
59 00:09:45,240 --> 00:09:53,460 you're going to be buying the dips or any retracements lower after a price like higher. And then the expectation is you're buying it when it retraces and then
60 00:09:53,460 --> 00:10:01,410 you want to buy it as it does that and then capture the next leg higher and everything's reverse for when it's bearish. We'd be looking for Four rallies in
61 00:10:01,410 --> 00:10:10,230 price. And we're looking to sell those rallies with the expectation that we're going to break to lower lows. Okay. And that's the optimal trade entry short and
62 00:10:11,220 --> 00:10:24,480 optimal trade entry long in a bear definition, simple definition. So what it looks like is on a fib, this is the basic model. There's been many approaches to
63 00:10:24,480 --> 00:10:33,180 having the Fibonacci show what I use for optimal trade entry. But this is the bare bones is how it started. This is how it is. And I'll show you what these
64 00:10:33,210 --> 00:10:45,270 settings are. Let's go here and click on it all AC the settings that way you can set your mt four or equivalent to the same. The zero level is first profit and
65 00:10:45,270 --> 00:10:59,700 scaling. I'll explain these as I go. 62% retracement level I'm rounding it. And then you have the 100 level which is one here. And then we have the percent sign
66 00:10:59,700 --> 00:11:13,260 dollar sign just allows the MT four platform to plot the actual value, you can see that over here. And then it's point 705 for the sweet spot for optimal trade
67 00:11:13,260 --> 00:11:29,730 entry. So the price level I'd like to see price trade to and 79%. And we have our target levels, which is zero, negative 0.6 to negative zero to seven, and
68 00:11:29,730 --> 00:11:39,600 then negative one for symmetrical price swing. Okay, and in the same as this done over here, I don't need to show you the property settings for that. It's
69 00:11:39,600 --> 00:11:51,810 the same thing just shown in a scale of looking for downside objectives. So the premises, we'll be looking for price to do something like this. Okay, we have a
70 00:11:51,810 --> 00:12:09,660 impulse price leg higher. And then we have another impulse price leg off that level and trading down into optimal trade entry. Okay, so we're trying to do is
71 00:12:09,810 --> 00:12:23,880 get below halfway of that price leg higher, down into 60 to 70 and a half to 79% retracement level. Okay. I tried to get my fill at 62. Just everyone knows right
72 00:12:23,880 --> 00:12:33,060 away. It's for completeness sake, I try to get at or very close to the 62% retracement level, I allow up to a little small deviation below the 79% trace
73 00:12:33,060 --> 00:12:43,980 level to 80. Okay, now allow that for price. Now, my stop will be exactly at this low, not 10 pips or five pips below that it's gonna be right at that low.
74 00:12:44,490 --> 00:12:58,620 Okay. So it's easily defined, if we're trying to get in at 16% trace level, it'd be my Philippine one. I'm sorry, 12 34.3, let's call it this is the gold market
75 00:12:59,010 --> 00:13:08,310 behind all this stuff, it's just that's the price is shown. I'd love to get their fill at basically 1235, we'll call it Okay, just a little bit about 62.
76 00:13:08,640 --> 00:13:16,650 I'm not going to fancy dance around, try to get the actual level, I just want to be in a level. That makes sense. Okay. And then between that and where I think
77 00:13:17,700 --> 00:13:26,730 the low should be formed based on my analysis where the price would be charged for the price swing, I'll show you what that looks like in a chart, the stock
78 00:13:26,730 --> 00:13:39,720 will be exactly right there. So between the two reference points, that would be the risk. Okay, the level up here. Zero level is when you take off first profit.
79 00:13:40,020 --> 00:13:51,570 Now, I like to go a little bit early, because it can always feel getting back to this high. So get that high, or just below it. That's where my first profit is.
80 00:13:51,810 --> 00:14:00,510 That's your first scaling. That's not your first target. first target is here.  Okay, so you gotta expect price to want to eventually get to this level, or
81 00:14:00,510 --> 00:14:09,450 maybe this level, if you're really extremely bullish all up here to have a measured move, what's a measured move the impulse leg low to high that move is
82 00:14:09,450 --> 00:14:11,340 it same thing just added to the high.
83 00:14:12,630 --> 00:14:22,890 Okay, so that's a perfectly symmetrical price swing, you don't always happen to that degree. And that's why we had to be looking to take profit rate before or
84 00:14:22,890 --> 00:14:32,160 high because it could fail there. And if it goes above it, at the 127 extension basically is what this is gonna be looking to take something off there. And if
85 00:14:32,160 --> 00:14:45,990 we get to 162 extension of here, I would be another portion for me to take profits and then if I'm extremely bullish, I'll leave small piece on for a
86 00:14:46,080 --> 00:15:04,530 measured move type effect. So the same thing is seen over here for when the markets bearish we look for an impulse leg Lower in price. Okay, and then we
87 00:15:04,530 --> 00:15:07,860 expect to see price retrace higher
88 00:15:14,549 --> 00:15:23,309 back into optimal trade entry. And that's defined between 62 and 79 centration.  Well, it could be anywhere in here. Now the problem is, is I'm not teaching
89 00:15:23,339 --> 00:15:30,239 supply and demand. So supply and demand zones and stuff like that I don't do those types of things, I look for specific price levels, and I'll teach you
90 00:15:30,239 --> 00:15:38,159 through the month of October, how to refine that down to a specific price level and not just wonder, you know, where it is in that zone that you're gonna be
91 00:15:38,159 --> 00:15:45,449 taking a trade at, okay, so I'm going to be the actual price levels to look for.  And the same thing, we would expect that price to show willingness to drop
92 00:15:45,449 --> 00:15:57,239 lower, limiting our risk to the actual high between their entry and the high, that's our risk. So we would take that amount of risk, define divided by, you
93 00:15:57,239 --> 00:16:07,019 know, the percent risk that we're willing to assume, based on our account, we'll say it's a half a percent, where a half percent of your account is you take that
94 00:16:07,019 --> 00:16:18,659 in terms of the pips, and break that down, that would give me your per Pip.  Leverage. And I know it's something I'm brushing over that rather quickly, it's
95 00:16:18,659 --> 00:16:28,049 because I'm trying to just give you a foundation. And then obviously, through the entire scope of October, we'll actually refinance, you can see how to do
96 00:16:28,049 --> 00:16:35,969 your risk, how to determine your risk and figure out what you can earn on the position and what your you're risking, and I'll teach you how to move all the
97 00:16:35,969 --> 00:16:45,239 stops when when it's supposed to be done and all that. But ultimately, we would expect to see it then move down into some reasonable objective, first profit
98 00:16:45,239 --> 00:16:53,639 would be down here, but just above the old low, so we will on take profit here.  The thing is, this is what why most traders screw up and they don't make money
99 00:16:53,639 --> 00:17:01,229 and they're not profitable, either in demo or in live, is they don't do this practice right here knowing where to get out, it's their first scale, you have
100 00:17:01,229 --> 00:17:10,589 to know what that is. And it has to be a reasonable amount of range, to promote the idea of justification for the risk. So if I know I'm getting in here, and my
101 00:17:10,589 --> 00:17:23,219 entry exit, at a loss is up here with my stop, it has to be a reasonable, you know, better than, in my opinion, better than two to one. Okay, and that's about
102 00:17:23,219 --> 00:17:32,039 as good as I get in terms of trusting reward to risk ratios. Okay, so what I'm looking for is everyone will look at this way, they'll say, Okay, I'm, I'm
103 00:17:32,039 --> 00:17:40,589 trading here at a short and my risk is here. So that's my risk, okay, whatever that multiple is, then they start doing this, it's okay, for, if I get short
104 00:17:40,589 --> 00:17:47,789 from that point, there's one R, there's two artists, three artists four, I think that's flawed. Okay. And that's the reason why I make fun of folks, when they
105 00:17:47,819 --> 00:17:57,239 want to talk about risk reward models, it really should be done on first scaling. Okay, so if I'm getting here as an entry, and my risk is here, it needs
106 00:17:57,239 --> 00:18:12,569 to be enough of the position coming off, that promotes at least two to one. So this is one are in terms of risk, whatever that is, I have to be able to make
107 00:18:12,569 --> 00:18:21,689 two times that in my first profit, that's what I'm trying to shoot for. Now, sometimes I'll take trades that are just slightly underneath two might be like
108 00:18:21,689 --> 00:18:30,689 one and three quarters, okay? If I'm really, really aggressive, and I'm just in a fast market, and we're not even fast mark, I should say, like this, if I'm in
109 00:18:30,689 --> 00:18:39,089 a market that is indecisive, but I'm already in a position. So management, I'll, I'll look to take out one and a half percent, but I'm really looking for trades
110 00:18:39,089 --> 00:18:50,819 that will frame a model that will give me around two. Okay, so whatever my risk is, from here to here, I want to times that from my entry to first profit, okay.
111 00:18:51,209 --> 00:19:02,789 And that's why I want to get as deep as I can, into that 70.5 level, I'm not going to demand 79% tracing level, I'm gonna be looking for the 70.5, preferably
112 00:19:02,789 --> 00:19:14,039 to give me my entry at 62. So that's what I'm looking for. So not all trade scenarios are gonna give me this gearing. But the ones that do, they're the ones
113 00:19:14,039 --> 00:19:23,699 I'm going to take, okay. And obviously, it's not as good if it's on like a minor five minute chart, because the range is gonna be very, very small, the setups
114 00:19:23,729 --> 00:19:33,839 that are on like an hour chart, they're good, because it'll give me enough of a range to get close to that two to one, reward the risk. And if I get that,
115 00:19:34,259 --> 00:19:43,019 everything past that first, scaling out takes care of itself. And that's why it's, I laugh when I hear folks saying it's stupid to take first profit or
116 00:19:43,019 --> 00:19:51,029 scaling out profits because your initial risk is x, and then you've taken a small profit, yada, yada, yada. Well, it's because I'm looking for these
117 00:19:51,029 --> 00:20:01,409 objectives down here, and it takes care of itself. Okay, and it ends up becoming my last portion ends up being way more generally Then what I did in my first
118 00:20:01,499 --> 00:20:09,989 scaling. So it's, it's not a, it's not an issue for me to be worrying about. And if you see examples of going forward, you'll you'll see quickly, there's no
119 00:20:09,989 --> 00:20:14,189 reason to be thinking it's a bad idea, actually. So
120 00:20:16,230 --> 00:20:23,520 let's go over to the charts. And I'll give you some examples of how quickly and easily you can find these setups. And it will give you all kinds of examples of
121 00:20:23,520 --> 00:20:34,680 it going forward in October. Okay, we're over here@tradingview.com. And admittedly, I'm a little clumsy when it comes to this platform. I've not been
122 00:20:34,710 --> 00:20:44,250 active in using it, but I've been practicing with it, so that we can use it as our medium for our teachings. So I want to kind of like draw your attention to
123 00:20:44,250 --> 00:20:58,290 how price on the euro dollar This is a weekly timeframe. And price in recent weeks have pushed above these old Highs over here. Okay. So if we did this on a
124 00:20:58,290 --> 00:21:17,670 monthly scale, and let's do it just for completeness sake. Okay, you can see this high here. zoom a little bit. We have this high here. And this high, comes
125 00:21:17,670 --> 00:21:33,090 in at 117 14. Okay, 117 14 this particular month. So what I'm going to do is I'm going to draw a horizontal line, right on it. And I'm going to ask you a
126 00:21:33,090 --> 00:21:46,590 question regarding pricing. So if we see price trade on this particular month, right here, it trades above this high rate above it. Once we go above this old
127 00:21:46,590 --> 00:21:54,630 high, just think in terms of simple support resistance, folks, it's not complicated. When price is above it, whatever that price level is, and we're
128 00:21:54,630 --> 00:22:06,810 gonna we already assumed not assembly that I figured it out that it was 117 14.  The markets trade in an algorithmic format. Okay, there's price engines that
129 00:22:07,170 --> 00:22:21,150 generate you, runs on pricing, and runs on stops and its accelerations in price and where delivery skips, and jumps to specific areas and pricing. The easiest
130 00:22:21,150 --> 00:22:31,470 way to understand what that is, is if you'd look at a chart, you can do it like on an hourly chart or a 15 minute timeframe. You can see not all timeframes, but
131 00:22:31,470 --> 00:22:40,410 really 15. In one minute, if you do it over a course of a week, you'll see how price gravitates from a full figure. Okay, and that would be an example of like
132 00:22:40,410 --> 00:22:58,650 117 00 to 118 00, that'd be a full Penny move in your dollar, that one penny move is broken down algorithmically to the 117. At level 117 50 level or mid
133 00:22:58,650 --> 00:23:09,780 figure 117 20 level. And then we have 117. Big figure. Okay, so my question to you is this, if price traces above it, this old high back here, because we broke
134 00:23:09,780 --> 00:23:21,180 through that this low this high? I'm sorry, this high is 117 14. So from an algorithmic standpoint, what price level? Would it want to reach back down into
135 00:23:21,930 --> 00:23:38,130 if it's going to go down for support? 117 20? Because it's just above the 117 14, right? So if this high would have been 117, say, 65? What would the
136 00:23:38,130 --> 00:23:51,030 level be that you'd expect to see it reach down into for an algorithmic support level? 117 50, mid figure. Okay, so think in terms of that. Okay. And what this
137 00:23:51,030 --> 00:24:03,060 does is it eliminates all this distraction. Okay, looking at ladders, and depth of market and all these types of things. You can probably swear by it and tell
138 00:24:03,060 --> 00:24:09,120 me you're doing really, really well. And that's great. Just like anybody else using crossovers and MACD, they can tell me they've done really well with that,
139 00:24:09,120 --> 00:24:18,030 too. I'm not telling you that you can't make money doing that kind of stuff, I'm just simply suggesting to you, there's a much easier approach to doing this than
140 00:24:18,030 --> 00:24:28,710 everyone's doing. So we're using an old high here, and while the level is 117 14 and the specific high, from an algorithmic standpoint, we would look for
141 00:24:28,710 --> 00:24:39,000 sensitivity or support to form around or at 117 20. Okay, so we're gonna leave the level here, and we're gonna drop down into a daily. Okay, so we have the one
142 00:24:39,000 --> 00:24:42,210 four on 117 14 level on our charts.
143 00:24:43,650 --> 00:24:54,300 And now I'm going to ask you to consider what is going on in reference to the institutional level from an algorithmic standpoint. In other words, we looked at
144 00:24:54,300 --> 00:25:06,450 our pricing model, it's four figure above it, the 20 level above That mid figure 50 above that the 80 level institutional. And then we have the next full figure,
145 00:25:06,720 --> 00:25:20,970 okay, or 118. So if we're above price, when it trades above it here, we expect to see price find support when it comes back down into the 20 level. Okay, so
146 00:25:20,970 --> 00:25:29,880 now we can adjust this level here and show at 117 20. Okay, so 117 20 is the institutional price level, from an algorithmic standpoint, price is going to
147 00:25:29,880 --> 00:25:39,690 want to trade back down to that level. The reason why it does that is it allows the market to pick up orders at just below or above that level. Okay, there's
148 00:25:39,690 --> 00:25:49,890 limit orders there. There's their stops there. But generally, it's coming down to run stops to pair the orders with smart money's limit orders. Okay. Every
149 00:25:49,890 --> 00:25:58,710 time you see my chart below the market, I'm always referring to as running sell stops above the market, I'm always referring to it as running by stops, those
150 00:25:58,710 --> 00:26:08,430 that are not in the know, they will question whether or not I'm using the right definition, I am using the right definition, because I'm looking at things from
151 00:26:08,430 --> 00:26:20,610 an institutional standpoint, those sell stuffs that are below the marketplace, smart money will have their buy limits, to pair up with those sell stops. Okay,
152 00:26:20,610 --> 00:26:30,240 so my perspective is not retail. So I'm looking at it from an institutional standpoint, from where I'm from, I don't look at retail. So if we understand
153 00:26:30,240 --> 00:26:47,160 that the market is above this 20 level, when it trades down into it, we should see the market trade into a support level. That support level is going to be
154 00:26:47,160 --> 00:26:59,070 defined by some pricing model. And I just gave you one, it's very simple. We use the old monthly high. And we're finding support, we want to see price trade off
155 00:26:59,070 --> 00:27:11,430 of that and give us a pattern. So now we have a level it's been rounded to institutional level 20 1720. And now we can drop down into lower timeframe
156 00:27:11,430 --> 00:27:35,730 charts, and we'll just look at a 15 minute timeframe. Okay, and then we'll Okay, here we are. Alright, so we have price trading down on the 27th and hitting the
157 00:27:35,730 --> 00:27:51,210 20 level notice what it does it hits it and then rallies away that rally. This is what you're looking for you want to see it take out a short term high. That
158 00:27:51,210 --> 00:28:09,780 is seen here. Your short term high, it trades through it. Once it does that, this break above that short term high is a market structure break. Okay, so now
159 00:28:10,650 --> 00:28:22,200 from an algorithmic standpoint, to price will want to retrace back down. Once it retraces, okay, it's going to pick up more orders. And then rally again. Okay,
160 00:28:23,220 --> 00:28:34,620 we have another break above this short term high here. And I'm quite certain you guys that are more proficient with trading view, you're probably smile and
161 00:28:34,620 --> 00:28:43,530 saying he could have done this or that and just made a copy. I don't know all that yet. Since Give me some time. So we have another break here. Okay, so we
162 00:28:43,530 --> 00:28:54,300 have short term high broken, and another high broken Now watch this high being higher than this one from a market structure standpoint, short term high,
163 00:28:54,780 --> 00:29:07,230 intermediate term high. So now when this breaks here, we have a much more solid setup for a pinch potential running in price higher. Now we have to enter the
164 00:29:07,230 --> 00:29:17,160 optimal trade entry. Because we already have a consolidation in here, price trades away can come back to the consolidation, distribution, redistribution,
165 00:29:17,190 --> 00:29:20,280 smart money reversal, low risk buy.
166 00:29:22,350 --> 00:29:29,970 In here we're looking for another area to buy, okay, or another area of accumulation or re accumulation to take us above this consolidation. Now what I
167 00:29:29,970 --> 00:29:41,670 just described to you is a market maker by model Simple as that some of you will say, well, that's wycoff. Well, I kind of got the idea from looking at price
168 00:29:41,670 --> 00:29:51,540 action alone. And then when I saw wycoff describing that, that scenario, it made me feel better that I seen something that someone years and years before me was
169 00:29:51,540 --> 00:29:58,500 able to see that same price structure, but his definitions and things I don't use that as a different approach and folks that went through my mentor ship know
170 00:29:58,500 --> 00:30:06,180 right away and I've challenged them as well to go through, like often see if what I was teaching was wycoff. It's not it's very similar in terms of the
171 00:30:06,180 --> 00:30:17,370 general market profile itself, because it's it's a very generic process. markup and discount, it's as simple as that. But the long and short is the, the run
172 00:30:17,400 --> 00:30:33,810 above here, right there. That impulse leg is all that's necessary. Because now we have a bi profile, or model that would take us above this consolidation. So
173 00:30:33,810 --> 00:30:42,660 we would look for this whole price action right in here to be treated above, okay? Because that's where the buy stocks are hitting are sitting. So smart
174 00:30:42,660 --> 00:30:54,120 money buys down here at the 20 level. And we would know this level beforehand.  And it's basically the 118 20. Because above this high, this high would be
175 00:30:54,780 --> 00:31:07,560 118 10.2. And obviously, above 118 10, the institutional level be what 118 20.  And that would be where smart money would want to exit running those buy stops,
176 00:31:08,970 --> 00:31:16,890 why they want to run buy stops, because the orders they picked up down here going long, and then bought more down here, there alone. So they have to have
177 00:31:16,890 --> 00:31:24,930 people that want to buy it from them at a higher price. So buy stocks that would be above here, why would there be buy stops there, Michael, because folks that
178 00:31:24,930 --> 00:31:34,170 are being short, this is the last intermediate term high. For anyone that has not trailed their stop loss lower and got stopped out, they're going to make a
179 00:31:34,170 --> 00:31:45,480 run on that liquidity right there. Which is a reason why the market maker by model is so well. Good. Alright, so we're gonna look at this little area right
180 00:31:45,480 --> 00:32:00,750 in here. Okay. And this is going to be the optimal trade entry that we're going to talk about Just for tonight. And let's make this a little bit bigger. Okay,
181 00:32:00,750 --> 00:32:10,740 so this impulse leg rolling away, and then coming back down, picking up more orders. That's optimal trade entry. That's what it looks like in price. That's
182 00:32:10,800 --> 00:32:24,660 the executable price that you can trade on. Now, I'm going to ask you to let me go back to empty for just for the the pattern sake, I wanted you to see how it
183 00:32:24,660 --> 00:32:33,690 can be shown on trading view. It's not just simply a mt four trick pony, it's there as well. But I want to go over to Mt. Four, because I'm little bit more
184 00:32:34,920 --> 00:32:50,250 efficient with that charting platform. And then we'll go into looking at the example. Okay, so we're mp4. And that's kind of like, re define what we've
185 00:32:50,250 --> 00:33:01,830 already discussed. This is the old monthly high. Okay, 117 14. And price was coming down away from higher levels. And we had a short term low here. And we
186 00:33:01,830 --> 00:33:12,780 had a little bit of a rally in there. And folks to try to capture old lows or try to capture any advancement higher, if they're lucky enough to get in and see
187 00:33:12,780 --> 00:33:20,850 a little bit of profit, they obviously fall in love with it, they marry the vein, the expression is, and obviously there's their stock would be wrestling
188 00:33:20,850 --> 00:33:31,980 below that. So the market trades down into that 20 level institutional level, picks up orders right in here. Okay, runs hits that and then rallies through
189 00:33:32,280 --> 00:33:41,910 breaking this short term structure high. When it does that we have a market structure break. We wait for a retracement lower. Okay. Now the first time it
190 00:33:41,910 --> 00:33:55,950 does this, you're going to maybe lose the low risk buy for a market maker by model. The consolidation here to run away Come back to the consolidation,
191 00:33:56,070 --> 00:34:05,490 distribution, smart money reversal, low risk by re accumulation. That's where we're looking for the next area of accumulation. So
192 00:34:06,810 --> 00:34:16,890 this short term Hide me in broken here, we made sure that this is a higher high than this one. So this is an intermediate term high. Okay. My old tutorials
193 00:34:17,520 --> 00:34:27,570 brought out concept I picked up from Larry Williams, which is my mentor. Back in the 90s. He taught market structure and high there has to lower highs on either
194 00:34:27,570 --> 00:34:39,180 side of it. It makes that pie in the middle, a significant high and that as it nests out. It gives us a market structure model here, this high being broken,
195 00:34:39,210 --> 00:34:48,660 right there is much more convincing than the short term here without understanding everything I'm giving you here as an outline, or understanding the
196 00:34:48,690 --> 00:34:56,250 expectation of how orders are stacking around higher timeframe key levels and understanding algorithmic price models because that's what I'm teaching here
197 00:34:56,250 --> 00:35:03,990 tonight. From a very basic approach. This is all stuff I told In my free tutorials, sniper, and precision trading concepts and all the other stuff in
198 00:35:03,990 --> 00:35:21,090 between. But this rally right in here, this impulse leg, right there is all that we would be looking for. So this move up, when price trades up and creates the
199 00:35:21,090 --> 00:35:31,290 high, what it's doing is it's making a more convincing run above this high. So it's a market structure break on an intermediate term high, says much, much more
200 00:35:31,290 --> 00:35:39,780 reliable, so the retracement on that it's going to be much more significant. So when we look at price moves, we want to look at the price move on the bodies of
201 00:35:39,780 --> 00:35:48,390 the candles, I've taught this in my tutorials, the wicks are always going to be the thinnest price action, okay. And if you look at everyone's price, across all
202 00:35:48,390 --> 00:35:58,800 different platforms and brokers, the part that's always different, that throws everyone off is the Wix because the broker is allowed to have some measure of
203 00:35:59,910 --> 00:36:07,500 flexibility. I'm gonna say that's the polite way of saying it, where they can spread price a little bit more. So you're already getting a derivative of price
204 00:36:07,500 --> 00:36:18,120 from an interbank feed anyway, but the discrepancy between that and what you see your broker is many times way off, okay? And you sign your agreement to that
205 00:36:18,120 --> 00:36:25,890 when you set up your account, you're allowing that to occur, okay, so you can cry about it, they did this to me to do that to me, but you really gave them
206 00:36:25,890 --> 00:36:34,470 permission. So it is what it is. Alright, so this rally we're looking at, we're going to put on the bodies of candles. Up here, this is the highest body right
207 00:36:34,470 --> 00:36:49,050 there. This candle right there. And we're going to look at that as the open to open is 117 99. So that's where our fib will be dropped right? There. Okay, well
208 00:36:49,050 --> 00:36:58,080 let go. So now what happens is price rallies through impulse leg up, and it drops back down, look how nicely it gets another little bounce rate there,
209 00:36:58,680 --> 00:37:07,410 trades back up higher, and it spends all this time on a 15 minute time frame.  This is going to chop traders with no patients up, they're gonna get scared
210 00:37:07,410 --> 00:37:13,590 every time it comes down. Or when it starts to rally like this, they jam their stop loss, right and then underneath this low here, and then look at it does
211 00:37:13,590 --> 00:37:22,050 eventually comes back hits it, you have to give the price freedom to trade from where you're trying to get in at to your stop, let it go to the full stop. It's
212 00:37:22,080 --> 00:37:31,140 there for a reason to protect you. But if you don't give it room to breathe, you're never going to give these markets, the ample room that needs to die,
213 00:37:31,140 --> 00:37:39,810 right and then expand towards your targets. So the same Fibonacci settings, okay, nothing's different here. When trades up to this price level right there
214 00:37:39,840 --> 00:37:49,770 or just below it, there's your first profit. Okay? So what if you're trying to get in at 70.5 or 62%? retracement level, this movement here, you got to see at
215 00:37:49,770 --> 00:38:03,180 least two of that. One, two, okay? First profit scale off, put your stop the breakeven, let it go. Price trades up to the first target. You can scale
216 00:38:03,180 --> 00:38:11,280 something off their trades to this level here, you can scale something off their entries up to symmetrical price swing hits that Okay, and then look at the
217 00:38:11,280 --> 00:38:21,240 reaction after that all the way back down. You think that's by happenstance?  It's no coincidence? No. It's going to an area of liquidity. We have a bearish
218 00:38:21,240 --> 00:38:29,880 order block here. overlaps at Target to really nice move there. But look at this short term high here. What do you think's resting above that? Buy stops. Now
219 00:38:29,910 --> 00:38:35,580 there's going to be something out there that don't understand what I'm teaching because they don't see things from an institutional standpoint, they have no
220 00:38:35,580 --> 00:38:38,220 idea how to look at it like this. But there is
221 00:38:39,810 --> 00:38:47,880 trailed by stuff that don't get trailed down here. Not everyone carries that model where they got to jam it up seven ticks, you know, above the recent high
222 00:38:47,910 --> 00:38:57,090 when they're bearish. It's what retail those longer term trending models, they have their stops farther back. Okay, and this is one that we've been targeted.
223 00:38:57,270 --> 00:39:06,630 And here's another one as well. Okay, and it overlaps with the symmetrical price swing that we have on our fit, okay, which is 100% measure move of whatever the
224 00:39:06,630 --> 00:39:16,440 impulse swing is, this low to this body's high is the same thing from that body's high all the up to this level, it's 100%. The same in terms of pips and
225 00:39:16,440 --> 00:39:29,160 range, it's the same thing from this price point to here, add it to this and you get that very, very precise, very, very precision based trading, it reaches for
226 00:39:30,000 --> 00:39:42,300 the 20 level. Okay, you cannot come much work there, what's around it near the 20 a lot of 20 2020. So, the market will gyrate and work around these levels
227 00:39:42,300 --> 00:39:52,140 here. Okay, this is one penny move in the euro. So look at the sensitivity around the 20 level. It trades up to and consolidate, consolidate a little bit
228 00:39:52,140 --> 00:40:01,290 and get another optimal trade entry rate in here. From this impulse Lake up, rallies again, what's it doing it near the 50 level Well, it's not exactly a 50.
229 00:40:01,290 --> 00:40:12,270 Michael Exactly. Because at these levels at 50, there's orders that are just above it, or just below it, or at the 50 level, just like we have at the 20
230 00:40:12,270 --> 00:40:21,540 level, it can be at the level 20, above the 20, a little bit or below it, everyone's gonna have orders that are close proximity to these specific levels.
231 00:40:21,540 --> 00:40:28,890 That's why the algorithm reaches for them. Now institutions like these levels, from a generic standpoint, because it makes it easy for them to price their
232 00:40:28,890 --> 00:40:40,860 models, and we had the old high at 117 14, that's an odd number. So look for the manipulation here, stop running in a break in Mark structure rally, when we have
233 00:40:40,860 --> 00:40:47,850 that, anticipate some measure of buying, and then wait for the intermediate term high to be broken here, you're going to lose all this, there's nothing wrong
234 00:40:47,850 --> 00:40:54,570 with that. But if you want high probability, and you want confirmation, and I'm holding my fingers up in quotations, you want confirmation, this is what it
235 00:40:54,570 --> 00:41:01,410 looks like, yeah, to have an intermediate term high broken with market structure, and then do everything listed here. And you have a complete trading
236 00:41:01,410 --> 00:41:12,930 model targets, how to know when to do it, using higher timeframe level what the reach for while you're gonna have to look for a high to run through. Okay, so if
237 00:41:12,930 --> 00:41:21,510 you're buying low, you want to sell high, where do you sell high it, just find it on high somewhere, okay, and do it in that scope that as we outlined here,
238 00:41:21,540 --> 00:41:29,550 this is one example you see any examples of these going forward. But this is this one that is available to you. And you can see it in your own charts, and
239 00:41:29,550 --> 00:41:38,940 study it and seek it in other pairs throughout this week that we've had, and find similar examples of this even looking for it for shorts as well. But this
240 00:41:38,940 --> 00:41:46,860 is going to complete this first introduction to optimal trade entries as your first time here. This is what it looks like. Coming back down into it here.
241 00:41:46,860 --> 00:41:56,160 That's the buy. Okay, you can buy here or here. And look at the dynamic reaction reaction. Now, with this like it is on the chart, I'm going to drop down into an
242 00:41:56,190 --> 00:42:04,830 hourly chart, and you'll see why I like the hourly setups because they're much cleaner, a lot of noise when these lower timeframes, but same impulse like here,
243 00:42:06,390 --> 00:42:14,010 and it comes right down. It's beautifully here the body is respecting the candle, I'm sorry, the body's respecting the fib level not that the fib level is
244 00:42:14,010 --> 00:42:26,430 giving them is no magic in the fib. It's just giving a specific framework for us from the best perspective we could have not being on an interbank level
245 00:42:27,060 --> 00:42:33,390 institution where you can actually see because you're not seeing these orders, folks, you're not you know, that's why I laugh when folks will say, you know,
246 00:42:33,390 --> 00:42:41,190 I'm looking at, you know, well, I said I wasn't gonna do those types of things, I'm not going to belittle anybody else. Because if you're making money doing
247 00:42:41,190 --> 00:42:48,900 what you're doing, you know, God bless you. That's why I like forex. Because I understand the animal, and the things that everyone hopes they can see in a
248 00:42:49,170 --> 00:43:00,300 little gimmicks in their indicators. That's what makes the opportunity because it's there for us to take, because it's giving a sentiment, it's providing and
249 00:43:01,080 --> 00:43:11,160 molding, a traders mind or a trader sentiment about a market? And what are they going to do? instinctively, they're going to react, and I don't react, I
250 00:43:11,160 --> 00:43:18,270 anticipate. And that's what we're going to teach using just one simple pattern, optimal trade entry. And you'll see that that's all you really need. You've
251 00:43:18,270 --> 00:43:29,910 never needed anything more than that. But I asked back then you think it's 2012?  If you want to go deeper, and 667, you want really deep nine, they know
252 00:43:29,910 --> 00:43:37,890 everything I know. And I'm not teaching another mentor ship to please don't ask me people are still asking, that's gonna be the first introduction to it.
253 00:43:37,950 --> 00:43:48,030 Obviously, it'll be much more refined and structured as we go forward. But this is certainly good enough. And it really gives you an encapsulated view of an
254 00:43:48,030 --> 00:43:58,080 entire breakdown from an institutional price move, how institutions work inside the model of how prices being delivered, and why it should go, where it's going,
255 00:43:58,080 --> 00:44:07,740 and what does setup look like and where they occur. But you have to understand how the algorithm that makes the price engines drive up and down. They drop down
256 00:44:07,740 --> 00:44:19,470 to allow traders to pick up orders at very, very, very low pricing. And then it rallies up to allow traders to get out at very high high prices. So in between
257 00:44:19,470 --> 00:44:29,100 there. There's opportunities to trade. You don't see them because you're not trained or taught from a retail perspective. But I just gave you here is exactly
258 00:44:29,100 --> 00:44:37,410 how bank level traders trade and anybody that says different simply doesn't know anything for what you're talking about. So until next time, wish good luck, good
259 00:44:37,410 --> 00:44:39,180 trading, and I'll catch up with you next week.