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Version 1.1 by Drunk Monkey on 2020-11-20 16:22
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3 ICT: Okay, folks, this is the volume number six in a
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7 continuing series of 20 videos from the inner circle
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11 traders, optimal trade entry pattern recognition series.
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15 Yes, that's a mouthful. So looking at the daily chart of
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19 crude oil, you can take a step outside of forex again and
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23 look at a commodity market. This is a widely traded asset.
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27 And if you look at what we have here on the daily chart, I'm
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31 going to pose a question to you and I want you to think
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35 about what would be the most likely directional run above
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39 this candles high or below this candles low based on what
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43 you see here. This pattern here is pretty popular in the
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47 retail universe. They like to see these doji candles, okay
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51 or PIN bars. They naturally assume that that's going to
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55 create a top in the marketplace and then it should go lower.
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59 I love trading against this pattern here. So one of the
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63 things if you are a collector of of ICT bullet point wisdom,
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67 if you look at the dojis. Okay, or PIN bars, I'd like to see
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71 those purged. I'd like to see them run above that. And if
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75 you look at what has happened so far, I mean, we've been
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79 running up correcting since it crashed in terms of the oil
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83 market. And if you look at this candle, which is yesterday's
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87 daily range, is it more likely to break below and trade
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91 lower or trade higher? My argument would be it would likely
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95 run this candles high, not just this candles high. But this
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99 candle tie, because there's a lot of sentiment built into
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103 the crude oil market based on this pseudo pinbar or doji or
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107 whatever they want to classify Steve Nielsen's patterns. I'm
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111 not here to try to kick dirt in his face, but there just
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115 simply isn't enough to warrant a financial decision based on
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119 some willy nilly pattern in a candlestick formation. Okay,
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123 so there has to be an underlying narrative and the narrative
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127 is everyone's bearish crude oil right now. So any retail
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131 idea that would paint the sentiment as bearish or maybe it's
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135 likely to go lower. They're just going to move on that. So
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139 it's not just limited to running this candles high. And high
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143 comes in at 26 point 45. So that's a near term objective,
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147 but we're really interested in seeing the high on this
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151 candle here at 2674. Okay, so 2674 very, very likely
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155 scenario to make a run to that now, it doesn't mean the very
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159 next day or the 14th, which is the time of this recording
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163 that we would run through this high it would just be a drop
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167 in liquidity, okay. And onwards means of determining bias.
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171 Okay, I get a lot of questions. from people that are in my
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175 mentorship just starting out, or outside the mentorship,
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179 they always asked me in the email, can you teach me how to
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183 determine the bias because if I could learn how to do the
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187 bias, I could trade profitably. And I would argue that's
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191 probably not true. Because you have placed so much emphasis
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195 on whether or not you can be right or wrong on a daily bias,
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199 the assumption will be led to you trying to day trade every
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203 single day. And while you may be profitable, few times a
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207 week, there's few times that you aren't, you'll go into
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211 revenge mode, and you'll just parlay your losses into larger
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215 losses. Alright, here is our five minute chart on the crude
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219 oil, June delivery contract for 2020. And we're going to put
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223 a little bit of lipstick on this. And we have the previous
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227 day's high here, the daily delineations. So this is the 14th
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231 the day of this recording. You can see that we did run
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235 previous day's high here but it was done in a very shallow
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239 capacity. So we're learning To see if we get a retracement
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243 down into New York session which you can start to see the
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247 beginning of the annotation my chart here, I do want to put
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251 on the 2674 level. And we'll just make that a black level
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255 just to delineate what I'm referring to. Alright, so again,
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259 back on this chart here, this pinbar if you want to call it
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263 that retail idea is 2674 for the high and that's the level I
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267 have here 2674 we trade up into 2675. So we went one point
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271 into that, and then we rejected that
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275 liquidity would rest above here. And likely run a deeper run
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279 above the previous day's high. So that's what we're looking
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283 for. But the black line is specifically related to that
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287 daily pinbar or doji candle that would be deemed bearish
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291 from a retail level trader. All right, and let's take our
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295 fib and add it to the New York session. Alright, so there's
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299 our fib and the low here to the high here, it retraces down
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303 into optimal trade entry 62% retracement level we're going
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307 to use as our entry 25 point 90 would be our entry and to
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311 start would have to be below below here. So we'll use 68 to
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315 68 and 90, that's 32 points are about $320 per contract risk
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319 and we will be reaching for previous day's high initially it
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323 does that here. And then we will be looking for one standard
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327 deviation up to 26.75. And if we get to 20 7.28 we would
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331 completely collapse the trade and being okay with taking
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335 that as our daily objective. And you can see here as the
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339 market runs forward, we do get our second standard deviation
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343 and we will be out there does run a little bit more, but I'm
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347 not teaching you swing trading. I'm not teaching you short
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351 term trading. I'm teaching you a bread and butter approach
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355 to going into looking for daily setups using specific
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359 criteria aiming for previous day's highs or lows and using
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363 the new york session as your catalyst to do so. Hopefully
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367 you found this insightful until next time, I wish you good
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371 luck and good trading.