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OTE Pattern Recognition Series - Vol 18.srt

Last modified by Drunk Monkey on 2021-06-10 10:01
1 00:00:09,960 --> 00:00:17,220 ICT: Okay, folks, welcome back. This is volume 18, and continuing series of 20 videos for the industrial traders, optimal trade entry pattern recognition
2 00:00:17,220 --> 00:00:27,930 series. Alright, so our example today is from the treasury bond futures contract and the delivery contract month is September 2020. This at the time is recording
3 00:00:27,930 --> 00:00:40,410 June 2 2020. The open interest is the highest in September contract, even though the nearby contract is June. So we're electing to follow this month for treasury
4 00:00:40,410 --> 00:00:49,050 bonds. And once you take a look at the daily chart, notice that we have this high to this low, I mean a retracement in here. And on the first of June, we had
5 00:00:49,050 --> 00:00:59,460 a nice reaction in here. So is it more likely to take out this candles high or this candles low? Notice that we have a turning point here, a lower turning
6 00:00:59,460 --> 00:01:14,580 point here. And now we had a reaction within optimal trade entry. So is it likely to take the low out or the high out? Not the high, the low. And we have
7 00:01:14,580 --> 00:01:28,170 relative equal lows here as well. So that could be a potential target. So I'm going to take this off, and we're going to draw out the low here so when we drop
8 00:01:28,170 --> 00:01:40,080 down into the lower five minute chart, we'll be able to see the delineation of this particular day's low and it comes in at 177 and 230 seconds. So let's drop
9 00:01:40,080 --> 00:01:48,780 down to a five minute chart. Okay, so here is the five minute chart on the September contract for the treasury bond market. And you know the drill, pause
10 00:01:48,780 --> 00:01:51,090 your video, study what you think you see here.
11 00:01:57,990 --> 00:02:09,960 Okay, so let's take the annotations and add them to the chart. New York session and we have our high to low and retracement back into optimal trade entry. And
12 00:02:09,990 --> 00:02:24,480 this requires a 62% retracement level entry at 177 and 2030 seconds to the entry is our hypothetical 177 and 2030 seconds. it suffers a drawdown now I'm having
13 00:02:24,480 --> 00:02:34,620 annotations here not saying that you would be filled here you will be filled here on this candle right there that particular candle and you have one candle
14 00:02:34,980 --> 00:02:46,380 here it goes a little bit against you. But this all these candles here these it's two ticks, which is $31.25. Each contract, or in this case would be $62.50
15 00:02:46,380 --> 00:02:57,840 drawdown. And using a six tick stop. So it's six times $31.25 per contract that you're trading. And we have relative equal lows here as well in this heavy line
16 00:02:57,840 --> 00:03:15,990 here is the previous day's low, say June 1 daily low, you can see that we did create an optimal trade entry. Looking forward to trade down below that. And
17 00:03:15,990 --> 00:03:27,510 ultimately, two standard deviations, that's our day trade for this model is a total of 29 ticks or $906.25. Now if you'd left a leader in something to see if
18 00:03:27,510 --> 00:03:38,400 it's gonna catch a runner, it does in fact go down here and actually trades to a point at which for one contract that was over 16 $150 per contract. So not bad.
19 00:03:39,960 --> 00:03:48,690 Really hard to beat the bond market. It's been tough recently because of all the consolidation and such but when this market does move, there is no better market
20 00:03:48,690 --> 00:03:58,350 out there. It beats forex, it beats index futures, it beats crypto and beats everything. It's so perfect. It allows very ultra short term trades to have very
21 00:03:58,350 --> 00:04:05,580 tight stops. As you can see here. This could have actually been done with a four tick stop loss and Odin fine. So hopefully you found this example insightful.
22 00:04:05,700 --> 00:04:07,770 Until next time, I wish you good luck and good trading