OTE Pattern Recognition Series - Vol 03.srt
Last modified by Drunk Monkey on 2021-06-10 10:01
| 1 | 00:00:11,160 --> 00:00:20,370 | ICT: Okay, folks, welcome back. This is part three of the continuing series of the ICT optimal trade entry pattern recognition series. And we're a step outside |
| 2 | 00:00:20,370 --> 00:00:31,020 | of forex. As I mentioned, one of the central tenets of this pattern is it's not limited to forex. So I'm going to show you how you can use it in the futures |
| 3 | 00:00:31,020 --> 00:00:43,080 | market. This is an index futures. And it's the delivery contract of June 2020. of the s&p e mini futures. Alright, so we want to look for a signature in price |
| 4 | 00:00:43,080 --> 00:00:54,330 | that would lend well to aiming for a previous day's higher low. And again, it's focusing primarily on a very short term timeframe. But the pattern can be scaled |
| 5 | 00:00:54,510 --> 00:01:04,440 | to whatever timeframe you really want. So looking at the price action here, you can see that we have a swing low swing high and a retracement here, and price |
| 6 | 00:01:04,440 --> 00:01:15,810 | was underway going higher. And there's no necessity for you to say, I have to be in this here, or I have to be in this here. Or I can't participate in a market |
| 7 | 00:01:15,810 --> 00:01:27,900 | like this and be a buyer, which is not true. So I want you to take a look at the framework here. We're presently in a larger daily optimal trade entry price just |
| 8 | 00:01:27,930 --> 00:01:38,340 | fell short of hitting the 70% retracement level. And again, the magic is not the fib. It's the target of liquidity. That's all I'm doing. The Fed just helps me |
| 9 | 00:01:38,340 --> 00:01:48,330 | frame an underlying context. It's not that you need these levels, it just gives you a framework. Okay. So the framework is we have an old low old high |
| 10 | 00:01:48,540 --> 00:02:00,150 | retracement and then starts to move higher. So on a daily chart, where is the likely momentum, it's going higher, okay, great. It could be reaching to this |
| 11 | 00:02:00,240 --> 00:02:09,420 | old high here, or it could fail to run that high or kick go through it and keep on going higher in this and since we don't care, we just know that the |
| 12 | 00:02:09,420 --> 00:02:23,430 | likelihood is it's probably going to run a previous day's high. So today's Monday of may 2020, may 11, specifically. So here's Friday, May 8 2020. And |
| 13 | 00:02:23,430 --> 00:02:30,810 | we're going to denote that high. So that price level is going to be significantly dropped on the lower timeframe. Okay, so here is the s&p e mini |
| 14 | 00:02:30,810 --> 00:02:40,980 | futures for June 2025 minute chart. And this is a naked chart so that way, you got a chance to take a look at this before I put the lipstick on this particular |
| 15 | 00:02:41,010 --> 00:02:54,270 | example. And you can pause the video here. Alright, so if you haven't paused the video and studied and looked for what I'm going to cover before actually show it |
| 16 | 00:02:54,270 --> 00:03:08,880 | to you, you're going to miss that opportunity. Now. The big figure 2900 price trades down into that during the New York session. Whenever I big figure is |
| 17 | 00:03:08,910 --> 00:03:21,690 | swept either down into it or up into it, it will generally create some kind of a tradable bounce, okay, or retracement. And while it may be there short term and |
| 18 | 00:03:21,690 --> 00:03:31,230 | short lived, it still gives the opportunity for you a quick snap in marketplace where you can take something out of it. Since this is a futures contract. And |
| 19 | 00:03:31,230 --> 00:03:40,650 | it's not a foreign exchange pair. We can't talk in terms of pips. So we're going to be using just the range. Now if you look closely, you can see inside of the |
| 20 | 00:03:41,010 --> 00:03:50,370 | New York session, the idea is the beginning is here at 830. And the end is again 11 o'clock, it's a static time, it doesn't change. So everything that I've shown |
| 21 | 00:03:50,370 --> 00:04:02,340 | you thus far, we're just doing the same thing every single day. And you'll see this pattern forums every single day. So let's take a look at the fib over top |
| 22 | 00:04:02,370 --> 00:04:14,370 | this right here. This is the optimal trade entry. The market rallies back above 29 big figure comes back down into bullish order block overlapping with a 2900 |
| 23 | 00:04:14,370 --> 00:04:23,490 | big figure inside of our specific time of day, the New York session. Okay 830 in the morning till 11 o'clock in the morning, New York local time. |
| 24 | 00:04:24,930 --> 00:04:35,490 | This pattern is seen with the fib to trade down into the 70.5 level, which is the sweet spot by my definition for optimal trade entry. And you could be a |
| 25 | 00:04:35,490 --> 00:04:44,010 | buyer there. And the market comes back down and does give multiple entries. You can take it on here, which is still inside of the New York session time window |
| 26 | 00:04:44,010 --> 00:04:55,710 | that we've created for this pattern. And we have really three candles here, here and here where it meets optimal trade entry 62 or less down to 79. And you could |
| 27 | 00:04:55,710 --> 00:05:03,930 | be a buyer there. We're going to use the range here. Okay, so point five You can take your first scaling their partials, and look how it spends a little bit of |
| 28 | 00:05:03,930 --> 00:05:15,210 | time consolidating there and then expands up to one to one full standard deviation here at 2922. So being a buyer at around 2900, big figure, and getting |
| 29 | 00:05:15,210 --> 00:05:29,160 | out with 15 handles in the s&p as a first scalp, or scaling, then your secondary exit for a partial could be at 2922, which is 22 handles in the s&p, then |
| 30 | 00:05:29,190 --> 00:05:38,430 | ultimately I mentioned in this pattern, this level here on the fib if it gets to that price level and runs a specific price point for liquidity, which is the |
| 31 | 00:05:38,430 --> 00:05:46,830 | Friday's of high which is we unintended on the daily chart, the market will likely rather want to gravitate towards that old Friday high because the trend |
| 32 | 00:05:46,830 --> 00:05:54,750 | is bullish, it's going to want to take liquidity out there because a lot of people are short selling in the s&p, the market has taken up above Friday's |
| 33 | 00:05:54,750 --> 00:06:06,030 | high. And to the fib level 2936. The high comes in on this candle at 2937 only off by one handle on the s&p. And it went up again to another opportunity to do |
| 34 | 00:06:06,030 --> 00:06:17,400 | so and again 2937. So it's only off by one handle. But you could take this idea here, instead of reaching for the 2936 round down to the nearest five level. So |
| 35 | 00:06:17,400 --> 00:06:26,760 | that would be 2935. So that's 35 handles with as much as one two and three partials taken out. But at this point here, I would be out for this particular |
| 36 | 00:06:26,760 --> 00:06:32,280 | pattern in this market as an example. Hope you found this insightful until next time, I wish good luck and good trading |