OTE Pattern Recognition Series - Vol 06.srt

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ICT: Okay, folks, this is the volume number six in a

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continuing series of 20 videos from the inner circle

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traders, optimal trade entry pattern recognition series.

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Yes, that's a mouthful. So looking at the daily chart of

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crude oil, you can take a step outside of forex again and

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look at a commodity market. This is a widely traded asset.

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And if you look at what we have here on the daily chart, I'm

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going to pose a question to you and I want you to think

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about what would be the most likely directional run above

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this candles high or below this candles low based on what

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you see here. This pattern here is pretty popular in the

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retail universe. They like to see these doji candles, okay

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or PIN bars. They naturally assume that that's going to

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create a top in the marketplace and then it should go lower.

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I love trading against this pattern here. So one of the

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things if you are a collector of of ICT bullet point wisdom,

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if you look at the dojis. Okay, or PIN bars, I'd like to see

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those purged. I'd like to see them run above that. And if

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you look at what has happened so far, I mean, we've been

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running up correcting since it crashed in terms of the oil

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market. And if you look at this candle, which is yesterday's

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daily range, is it more likely to break below and trade

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lower or trade higher? My argument would be it would likely

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run this candles high, not just this candles high. But this

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candle tie, because there's a lot of sentiment built into

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the crude oil market based on this pseudo pinbar or doji or

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whatever they want to classify Steve Nielsen's patterns. I'm

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not here to try to kick dirt in his face, but there just

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simply isn't enough to warrant a financial decision based on

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some willy nilly pattern in a candlestick formation. Okay,

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so there has to be an underlying narrative and the narrative

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is everyone's bearish crude oil right now. So any retail

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idea that would paint the sentiment as bearish or maybe it's

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likely to go lower. They're just going to move on that. So

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it's not just limited to running this candles high. And high

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comes in at 26 point 45. So that's a near term objective,

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but we're really interested in seeing the high on this

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candle here at 2674. Okay, so 2674 very, very likely

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scenario to make a run to that now, it doesn't mean the very

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next day or the 14th, which is the time of this recording

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that we would run through this high it would just be a drop

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in liquidity, okay. And onwards means of determining bias.

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Okay, I get a lot of questions. from people that are in my

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mentorship just starting out, or outside the mentorship,

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they always asked me in the email, can you teach me how to

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determine the bias because if I could learn how to do the

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bias, I could trade profitably. And I would argue that's

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probably not true. Because you have placed so much emphasis

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on whether or not you can be right or wrong on a daily bias,

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the assumption will be led to you trying to day trade every

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single day. And while you may be profitable, few times a

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week, there's few times that you aren't, you'll go into

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revenge mode, and you'll just parlay your losses into larger

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losses. Alright, here is our five minute chart on the crude

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oil, June delivery contract for 2020. And we're going to put

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a little bit of lipstick on this. And we have the previous

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day's high here, the daily delineations. So this is the 14th

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the day of this recording. You can see that we did run

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previous day's high here but it was done in a very shallow

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capacity. So we're learning To see if we get a retracement

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down into New York session which you can start to see the

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beginning of the annotation my chart here, I do want to put

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on the 2674 level. And we'll just make that a black level

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just to delineate what I'm referring to. Alright, so again,

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back on this chart here, this pinbar if you want to call it

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that retail idea is 2674 for the high and that's the level I

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have here 2674 we trade up into 2675. So we went one point

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into that, and then we rejected that

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liquidity would rest above here. And likely run a deeper run

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above the previous day's high. So that's what we're looking

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for. But the black line is specifically related to that

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daily pinbar or doji candle that would be deemed bearish

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from a retail level trader. All right, and let's take our

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fib and add it to the New York session. Alright, so there's

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our fib and the low here to the high here, it retraces down

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into optimal trade entry 62% retracement level we're going

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to use as our entry 25 point 90 would be our entry and to

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start would have to be below below here. So we'll use 68 to

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68 and 90, that's 32 points are about $320 per contract risk

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and we will be reaching for previous day's high initially it

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does that here. And then we will be looking for one standard

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deviation up to 26.75. And if we get to 20 7.28 we would

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completely collapse the trade and being okay with taking

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that as our daily objective. And you can see here as the

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market runs forward, we do get our second standard deviation

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and we will be out there does run a little bit more, but I'm

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not teaching you swing trading. I'm not teaching you short

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term trading. I'm teaching you a bread and butter approach

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to going into looking for daily setups using specific

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criteria aiming for previous day's highs or lows and using

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the new york session as your catalyst to do so. Hopefully

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you found this insightful until next time, I wish you good

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luck and good trading.