OTE Pattern Recognition Series - Vol 15.srt

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ICT: Okay, folks, welcome back. This is volume 15, and a

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continuing series of 20 videos for the optimal trade entry

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pattern recognition series for the inner circle trader

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YouTube channel. Alright, so our example today is going to

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be in the Australian versus the US dollar. And we have our

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charts already trained in the five minute timeframe. And I'm

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going to ask you to take a look at the chart, study it

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before I add the annotation. So pause your video now.

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Okay, I'm gonna add the annotations. Alright, so we can see

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our standard 830 in the morning to 11am New York Standard

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Time. Optimal trade entry right in here. This leg comes down

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exactly. At 8:30am the price leg is here to here and then

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down. Now there was a smaller retracement that was an

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absolutely an optimal trade entry. That's not to diminish

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that as the pattern, but we have to incorporate the elements

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of the time window. That's here. Okay so you can see on this

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particular candle 8:30am dead on it trades down your fill

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would have been on that candle, your fill 62% retracement

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level keeping with the models minimum rolls. Point 6619 is

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our entry. There's a four PIP drawdown from your entry and

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using a 10 PIP stop loss below this low here. We have an old

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high returning almost 10 pips, they're

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almost

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20 pips and you got one standard deviation offering a

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handsome Potential reward there. One and a half and finally,

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taking off at two standard deviations of the optimal trade

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entry range they're offering 39 pips just in this short

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little run here you know you have to whether this

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retracement and then ultimately gets to it there. So you if

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you use this one using the rules you'd be bailing out of the

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trade as a hit here, even though you could have taken

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partials at any one of these. Okay, so here is the secondary

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entry opportunity. And using this price legs low, the price

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laying high, the retracement down in your fill would be on

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this candle here. With the spread and your fill would be a

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hypothetical point 6639 entry you have only a three PIP

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drawdown and the run above the relative equal highs. We want

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to see expansion there and ultimately trades to one half of

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a standard deviation offering more than 25 pips. And this

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candle trades exactly to that high of 6667 and five PIP

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bets, which is right here, and doesn't go any higher than

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that consolidates and breaks down. This after trading down

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here would have eventually stopped you out even on the

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initial entry down here, you would have trailed your stop

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loss rate below these lows, you would have gotten stopped

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out at that point. So any partials that would have been left

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in the marketplace to try to get to the previous day's high,

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which is over here. That previous day's high coming in at

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6680. And two PIP bets is an undelivered target. And I

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mentioned this in my

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Twitter dialogue today basically, kind of like pushing and

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emphasizing what's more important, is it your target being

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hit or profiting because so many traders in this industry

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lose Money, and they've had open paper profit. And when I

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say paper profit, I'm not talking about just demo trading.

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I'm saying that. How many times have you traded with live

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funds, and then watched a potential profit completely turn

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around against you and go into a loss. Now, how many times

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Could you go back in time, hypothetically, and say if I just

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would have took something off when it was given me X amount

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of pips or X amount of dollars for return? And you did that,

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as a general rule of thumb, you always pay yourself. I made

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a remark yesterday on Twitter, along the lines that if you

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worked a partial week at your job, so you you work a normal

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Monday through Friday, and you worked Monday and Tuesday and

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became ill and didn't finish the rest of the week. Does your

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employer get to keep all of those earned income hours that

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you put in on Monday and Tuesday? Of course not. So when you

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put on a trade and the market offers you an opportunity to

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take something off, and scaling You have to do that.

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Otherwise you fall victim to something like this, where both

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patterns offered opportunity to book a profit,

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hypothetically. But if you don't execute those partials that

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are at logical levels, as we talked about in the fib, again,

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the fibs, not the magic, it's just logical levels for you to

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take off something you're not forced to. But this is what

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will happen. Invariably, if you keep doing this long enough,

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you're going to have a trade that will look good, it'll

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look, it'll look good, it'll look strong, it'll look like

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it's performing. And it may in fact, look like it's going to

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go and run up above that high, but it Peters out and loses

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momentum and goes the other direction. So you're either left

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with being upset and emotional about not taking partials and

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getting stopped out, or learning from that and saying, okay,

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I can take something off, and I'm not going to demand my

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best case scenario, exit or target. I'm going to take

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something off and there are a plethora of so called

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educators in this industry that will say partials is stupid

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partials is dumb partials is a rookie ploy or attempt to

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just satisfy the fear and greed tug award it's going on. And

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the last one I agree with, because it rewards your time and

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risk. And it doesn't matter that you're reducing the amount

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of potential profit, you're reducing the same thing on a

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relative basis that you had in terms of risk. You're

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reducing it as you take something off, you're paying the

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trader, you're rewarding, your risk, the initial risk, and

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take taking something out. Remember that workweek analogy.

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You have to find a way to grow comfortable taking something

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out of the marketplace when it offers it to you. If you come

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in As industry, or if you've been unable to find

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profitability, and you can't warm up to this idea, I

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guarantee you, if you try it, you'll love it. Because it

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manages all of that fear and greed, that tug of war that

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takes place. Once you put the trade on in a live setting,

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you want to get out of the trade, you wanted to get to your

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target right away, but you can't force that. But as it

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logically moves to levels where you could take partial

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profits and exit some of the position, thus reducing the

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exposure or risk, but rewarding and adding to your bottom

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line because these targets are not guaranteed. But guess

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what? If you're in a market, it's trading here, and you put

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your market order to get out. That's more likely to fill you

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in a profit than waiting for that undelivered target. So

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today, I kind of like pushed the envelope to try to get you

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thinking about this particular pair on Twitter. And it gave

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two opportunities both you yielded the potential to pay out

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but it did not hit the logical level of the previous day's

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high and it's not necessary to find profitability, getting

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your best case scenario targets. So if we found this

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insightful until next time, I wish you good luck and good

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trading