okay guys welcome to a new series ICT

scout sniper field training guide okay

let's look at what we're gonna be

covering in this presentation we're

gonna be reviewing the previous episodes

assignment price reactions and we're

gonna be looking at examples of pricing

price reactions we're going to go over a

brief overview of smart money concepts

and we're gonna be looking at interest

rates time frames range trend and power

three okay we're going to be revealing

the market maker okay we're gonna be

looking at the ICT market maker by model

and we're looking at how dealers operate

in support levels and we're gonna look

into ICT market maker cell model and how

dealers operate in resistance levels

we're gonna be looking at how market

maker business model works in

application can we looking at

understanding how market maker pairs

orders and how orders stack around key

levels okay we're looking at exposing

the mechanics of a price swing and we're

gonna look at more of the time and

especially working around the ICT kill

zones and we're gonna be looking at the

London kill zone specifically and the

New York kill zone we're gonna be

looking at how price is crucial to you

and as far as knowing your key levels

and how you setting up your

opportunities to trade and we're gonna

be giving you a homework assignment

stalking in the kill zone okay folks we

are looking at the euro/usd

this daily chart and when we're looking

at reaction levels okay the ones I'm

most interested in are obviously found

in the higher time frames now you can go

back to in monthly you can go back to a

weekly chart and look for these types of

levels as well but for the sake of this

teaching series we're just going to

focus

on the intermediate-term market and

that's gonna be divided at the daily and

for our and by hunting the reaction

levels on this higher time frame daily

chart and/or the 4-hour chart it really

puts the odds in your favor based on the

fact that the institutional level

traders that beats the bank's the large

funds and such they are really watching

these key levels now we discuss in the

first two episodes how we can look at

support resistance and have you know

high odds key resistance levels now

we're gonna build on that in this

episode here but for now while we're

looking at this I want to remind you

that the last episode we talked about

the fiber being poised to trade lower

okay now I purposely waited a little

while not as long as I did but the third

episode out but one of the wait a little

while to allow the market to move lower

based on that real-time if you want to

call it that in the recording that's

time and date stamped on YouTube the the

fiber was called to go lower

now we're gonna frame why that was the

case now okay but I want to reiterate

the fact that it was called lower

beforehand okay so the concepts we're

gonna employ and go over in this example

are gonna be beneficial to you going

forward because it's the same type of

thing you do over and over never again

just you know and on your own particular

pair or it could be a stock market you

know stock or commodity whatever it is

whatever vehicle or ask that class that

you find yourself a traitor in we're

delving and specifically the FX market

here in this series but it's important

you understand that my concepts are

generic okay and when I say generic that

means they're not boring in the sense

that they're not useful they're generic

in the sense that they're universal okay

they apply to every asset class minor

little nuances that have to be taken

into consideration but nonetheless they

are applicable to every market

that class so the homework assignment

was to look for reaction levels okay

mark them up on your chart and then

watch what happens in the coming weeks

around those particular price levels

okay and we're gonna do that now now I'm

not gonna beat it to death in terms of

what reaction levels and what support

misses levels we should have noted in

our chart but if we were looking at this

example here and this was real time and

the time if you sitting down in front of

the charts or when I would be sitting in

front of the charts this is how I would

mark up my charts okay and we're just

going to use the full horizontal line

just to save time because I spent a lot

of time monkeying around with adjusting

the the app the right end of a trendline

now I do like the trend lines because it

makes it neater when I'm drawing

horizontal support resistance now I

don't like trend lines on a diagonal

basis so don't get me miss quoted here I

do not have faith in diagonal support

resistance but I do have absolute faith

and horizontal support resistance as we

have here now what I'm doing is I'm

noting every swing high and swing low

that's relatively close we're gonna use

about 300 to 400 pip range from where

we're trading at in this instance here

now obviously you can see at the time of

this recording the price is already down

here but again I'm gonna count you to go

back to the recording and you'll know by

watching it that we called this market

going lower here okay so we have this

reaction high here okay when I was swing

high now what I'm noting again so you

don't lose lose yourself amongst my

banter here I'm looking at times where

candles have to higher candles on both

sides okay not to higher on each side

but to higher candles on one side in

other words you have a candle with a

higher low and on the left and a higher

low on the right okay and it and I'm 20

it does probably is it's probably

confusing it's not what I'm showing you

here but

this is a sudden a candle so you got to

take that in consideration and blend

that into this Monday so you do have the

the swing low here basing this Monday

candle and this Thursday candle here and

this is a Friday candle so you have that

swing low

okay so we'll have that noted okay and

we're gonna use this high here okay and

you see this one here now I realize

you're probably starting to think well

way base is getting really busy here

okay but what I want to draw your

attention to is the fact that we do have

these levels turning the market on a

daily timeframe okay so if the market

made its daily higher Lothair okay it's

significant okay now this is a moment

when you pull out your pad major

reaction levels okay occur around annual

highs and lows that means yearly high

and low quarterly your high and low in

other words every three months okay for

instance January February March in that

block of time calendar basis okay find

the highest high and high school I'm

sorry the highest high and lowest low in

that timeframe do the same thing for the

second quarter okay that being April May

June and then July August September and

October November December so there's

there's four quarters in blocks of three

okay cuz there's a quarterly shuffle

that goes on okay portfolio dressing and

such and you'll be able to see

significant highs and lows we're not

gonna do that here it's this series

isn't meant for you to get your sleeves

rolled up and do some homework on your

own okay and you're gonna learn by doing

it okay I'm leading you to the water but

it's up to you to drink okay you also

have monthly highs and lows those are

key important reactionary levels okay

and then you have weekly highs and lows

and you have intro week highs and lows

okay so in other words once you get to

like Wednesday whatever the highest high

and low is low was at that time

influential okay and then you have your

standard daily highs and lows okay and

here is one of the gold nuggets that

you're going to get okay whenever you

see a swing high

okay a swing high like this okay we have

a candle here with a lower hide candle

on the right of it and a lower hide

candle on the left of it okay this

pattern is very very strong and the

reason why it's so strong is because you

have to take a couple elements out of

that pattern okay and we're going to

start with the first candle here this

candle on the left of the swing high

okay you want to note the high the open

the low and the close on this candle you

want to do the same thing for the

highest candle in the three bar pattern

and you want to do the same thing to

open high low close values on that same

basis okay and whenever you see a swing

high on your daily timeframe you really

really want to have those data points

now essentially we have the high here

with this horizontal line and we

essentially have the open we're here

with this line okay but it was based on

this candle here now we have to have the

low I'm sorry the low here note it as

well okay you can see that happening

right there now I'm balling it true but

we can go down and doctor it up when we

get down to the lower timeframes but

here's what I want just just by clicking

that like I did here I want you to take

a look at what happens over here in

these candles see the bodies they were

having difficulty closing and opening

far beyond that level okay something

about these levels okay

causes the marketplace to turn okay

we're going to talk more specifically

about that phenomenon okay and another

SmartMoney concept applied to where

markets tented to blast off and have you

a trade opportunity presented to you you

can see things in advance based on what

I'm going to share in this episode here

but I want to show you how sensitive

these levels are and then

obviously because we have this market

open on this candle here if you go over

here look with you debt and you have a

bounce right off of that obviously we

can see that the the close of that

candle and that swing high we were

opening essentially near that same point

went in lower the candle here was unable

to make much move higher

we got fell short of it here the body of

the candle here as well okay so there's

a lot of insight that it's dreamed by

doing these exercises but it's also a

daily procedure okay but here's the cool

thing once you have these levels noted

okay

these when they're when they're a lot of

them like you see here this is when you

take your data and you write it down

your pad okay and that way when price

trades to these levels okay or

approaches these levels you'll have that

in - okay look use as a reactionary

level based on a daily timeframe so that

way you don't have to have all these

lines on your chart okay so we're going

to just want to take our chart and we're

going to drill down to a four-hour basis

okay and we're going to be just simply

looking at the the market from the

standpoint of August 23rd

okay I want to do was I've just moved

the fixed chart position and just a

little difficult to see here but I will

show you all that when I talk about

setting up templates for mp4 and how you

can maneuver around so we run into a

4-hour chart okay and here we are we're

essentially with these same levels noted

we move down into a four hour basis okay

and what I'm gonna just gonna do is on

the scrub forward a little bit okay and

right about here is where we were

talking about how the market was poised

to trade lower and I'll promise I'll get

to the point of which we're gonna

explain why is gonna go lower but for

now I just want to just illustrate how

the market eventually traded with these

levels okay now these levels were based

on key reaction levels on a daily time

frame before the facts in other ways

we're gonna basically establish a point

of which we'll delineate that with a

vertical line here let us say beginning

here you know we were expecting to our

cue lower and we're gonna start watching

and there's going to study how price

reacted to these levels going forward

okay

and really what you're doing is you're

you're looking at how price moved

reacted traded down to and up to

resistance and support how price worked

specific levels broke down found support

at it and then broke lower and moved

around and gyrate it okay now these

levels are just simply established off

of the daily time frame now when you

move to a four-hour okay like we learned

in the previous two episodes when you

break your market down from a daily to a

four-hour the four hours gonna have more

dynamic support resistance levels that

were not as clearly discernible as were

on a daily chart okay so this level here

okay you would have on your chart as

well and you can see the priests

reactions from theirs as well and you

have this swing low one could have that

on your chart as well

and you can see how price reacted around

that as well okay and now what we're

going to do is we're going to move to a

fifteen minute basis and we're going to

look at last week's trading

okay this is last week trading the euro

USD is a 15-minute timeframe no we're

gonna do is going to put two vertical

lines in delineating the actual days you

have Mondays trading here Tuesdays

trading here Wednesday Thursday and then

Friday down here now we again we're

calling the market lower and you can see

the market did in fact trade lower we're

going to be looking at how price reacted

intra week okay but we're going to talk

about some things that haven't really

been touched on if you've been finally

for a while in great detail

okay so now what we're gonna do is we're

gonna be discussing the have a market

itself we're gonna zoom out just one

more tap just you can get a feel for

what has happened the market traded

lower up in these levels here where we

were calling it lower and broke down

rather aggressively okay so you can see

much more dynamic view of how price had

respected these support resistance lines

that we arrived at on a daily timeframe

okay so now obviously we can see in

hindsight that it caused the market to

turn at resistance and support and once

the support was broken event situated

back to it found that as resistance okay

we understand their central tenants to

the marketplace and how technical

analysis is generally proceeded and or

viewed in hindsight basis okay but how

do we use these levels going forward

okay well number one unless you have

these types of price points okay or

support resistance levels on a hard time

frame there's absolutely zero reason to

expect a trade to form okay again here's

one of those night notepad moments okay

write this down and underline it several

times you do not look for trade or

trading pattern on your intraday charts

unless it is trading at a higher time

frame support resistance level okay or

at a higher time frame reaction level

that means the trade has to be

formulated and framed around a level

that you had already arrived at from the

daily and/or four hour time frame okay

now here's a question for you and you

already know the answer to this I'm sure

so again I'm not trying to browbeat

anyone but I'm telling you I've done the

same stuff so hopefully you'll learn

from it like I did and you'll you'll

stop the bleeding and you'll start

moving towards consistency so now

looking at your own personal trading how

many times daily weekly in the last few

months or so how many times have you

looked at a five-minute chart or a

one-minute saw or maybe you know an

hourly chart

looking for a pattern a price pattern

and then trying to you know chase the

market after you see it moving because

you you didn't have the the confidence

to trust the pattern because there was

nothing framing it on ok you just saw a

pattern or similarity of what would be

considered a price pattern and then

reacted to it after the market started

moving what you felt was a confidence

booster in the favour that you know the

favorite direction the pattern was

suggesting it would move and then all of

a sudden solvent market turn on you even

though that supposed price pattern was

there it eventually turned on you has

that happened to you I can tell you with

graces surety if it hasn't and if you

don't do these types of things it surely

will price patterns by themselves you

know you know almost speak harmonically

Gartley butterflies bats all those

patterns okay that you hear banded about

on the internet and or youtube

educational series or reviews or some

quote-unquote previews they may or may

not be profitable but if you don't have

that pattern framed around a real

reaction level okay and again we've

talked about why the market reacts like

it does and when you see market moves

that are dynamic okay because it's the

institutional sponsorship that takes the

market up or down okay

retail traders are not going to do

anything to this marketplace we are

participants that are hopefully like the

fleas on the dog okay we're on for the

ride once in a while we get a bike okay

but if we don't watch it the dog will

scratch us right off so we are hopefully

positioning ourselves at a time and

place really in terms of price where the

market is highly sensitive to market

reactions on the higher level trading

entities like the bank's large funds

institutions if those traders are

participating in the marketplace at that

time frame okay at that time of day at

that date okay at that price level

you are in a much better position

technically speaking as a traitor than

those that just simply go out and say

well you know the markets are going up

for the last six days so it's probably

gonna keep going on somebody's going

here and buy it today okay so I can tell

you I know a lot of people that send me

emails and again please I'm only using

this as an example so don't let this be

an impediment to you ever send me emails

or questions or comments or anything

like that but it you know folks do these

types of things and here's this here's

another you know disclosure I did that

same stuff guys okay when I should trade

commodities if the market was going

screaming up okay and I would be

watching it do it in the middle of the

summertime during drought season if the

wheat market was going straight up it

could be up for 19 days and I'm like wow

it's been going on let me just get in

there and buy that okay and sometimes I

was lucky and then other times I was not

okay because I was chasing the market by

having these levels predetermined based

on the heart timeframe you can sit on

your hands and exercise that dreaded

word patience okay because a lot of

times I yeah I talked about that and I

stressed the importance of having

patience and submitting to time okay

because if we're using these daily and

for our charts it's going to take time

for price to get to these particular

price levels now why am i teaching this

timeframe well because most of you can't

sit in front of your computers all day

long and trade for a living as much as

you aspire to do that you all have what

responsibilities you have mortgage

payments you have children you have

spouses to take care of if your wives

you have you know husbands to deal with

so the bottom line is is you have a lot

of responsibilities and very little time

on your hands to be able to apply to

analysis now sure you can go back and

look at the hindsight and study intraday

action like that and it's not certainly

nothing wrong with that but for the most

part by far and large majority of you

are watching this all have 9 defies or

similar that keeps you from having the

time to sit in front of the charts and

trade intraday so again I'm teaching

this timeframe because it'll allow those

to have jobs to formulate trading ideas

on your demo account

build confidence and understanding in

technical analysis and still possibly

take part of profitable swings that the

market entities push price up or down

based on you know these higher level

support resistance those now again we

have a snapshot in front of us here this

is essentially a two and a half weeks

worth of price data but again these

levels were noted prior to these price

points up here okay we were calling the

market lower up in here and the market

has slid lower okay to the tune of about

what is that let's get a good good feel

for what that price levels will get

about middle that consolidation and the

lowest low on last Friday comes in

around 285 pips or so not bad not bad

for you know a future perspective in

terms of analysis and a lot of my haters

that really are our new interest in

learning this stuff they just want to

derail and attract folks that are out

here doing this stuff for free I don't

sell nothing I just do it as a as a

hobby as you can see it's been a delay

in my release of this episode and that's

another reason why I'll never sell

anything because I really have a life

and I'm not going to subject you guys to

any kind of payment okay and you know

selling things because number one I

don't want the hassle to I don't need

your money and three I can't promise you

I'm gonna have the free time to

consistently give you what you would

reasonably expect Ilima paid service so

there are guys out there that have you

know services and some of them probably

shouldn't be doing it then you have

others out there that you know are doing

it and maybe there are you know

worthwhile and they have a you know

assistance to new traders it's not up to

me you need to judge those individuals I

can just tell you that me personally in

the form of a mentor you get what you

get and when you get it I mean I don't

mean to be ignorant about it but you

know like I said I do how would you do a

job of being a father a husband and my

life is interesting

maneet iams pulls me interactions I

really didn't plan on from you know time

I laid my head down to the time I wake

up a lot of things can happen in ICT

world and you know I could be involved

in things that I hadn't planned on and

and that's what this market can provide

for you a lot of freedom to do that very

thing I'm not locked into having to do

any one thing or another the freedom to

be able to say you know what I've

reached my goal I don't ever have to go

to my employment place anymore okay

whatever that is you plug that in if

you're you know if you work at a an

industrial job or if you're a truck

driver or if you're mechanic or if

you're a doctor a nurse

you know ice cream truck die how about

that house bottom line is is you have to

get to that point and it doesn't happen

overnight so use these tools okay to

help frame your inner trader that will

eventually come to fruition after you

gain a level of confidence in yourself

firstly that you can stick to the

procedures then trust the tools and then

when those two come together then you

find a level of consistency at your time

of choosing not when I say or another

mentor and whatever you know book that

you by suggest that you know you should

go to live trading or full-time trading

you'll know it when you know it okay

believe me you'll if you feel like

you're rushing you probably are so don't

don't get in a race to try to say well

I'm quitting my job okay

I'm throwing out these little notes I

have next to my keyboard here because

I've been getting emails so I'm kind of

tossing these little nuggets out in the

midst of having these recordings so

hopefully I'm answering your your

enquiries so now by looking at these two

and a half weeks or such and price data

we called the market lower back here

okay so how would one reasonably expect

to participate in the marketplace as

price moves lower number one we have

these price levels noted and again from

this point in here these levels were on

the chart they would be walking forward

you would see price reacting real-time

at these price points okay

again this is a 15-minute time frame so

you would have smaller dealing range

support resistance levels on these time

frames as well but not as important as

the daily end for our time frames

because those are where the large

institutional traders are spending you

know spending majority of their time

looking for value okay much we're gonna

talk about that so now again we talked

about how in the previous episode that

the market tends to make its high or low

in the first few days of the week

generally about Tuesdays long and open

and it's very latest many times you'll

find that Wednesday's London open is

like the last cusp of where the higher

low if it's down weak the high would be

formed but generally between Monday and

Tuesday you see it forming the higher

low and now with that going forward okay

you can see that we did have the high

form I think it just went above a few

pips maybe one or two pips here on

Wednesday so it came true as well here

move lower okay but then we moved into

this week here okay and it's kind of

unique in a sense because if you've been

watching the news

I've been reading newspapers and such

there's been some saber-rattling about

the US potentially striking Syria I'm

not going to go on the political stance

on you know get on my soapbox about what

we should or shouldn't do in regards to

that but it has caused a lot of

uncertainty in terms of what is gonna be

you know the outcome of all that okay

and it's really good in the sense

because it gives me an opportunity to

plug in something that otherwise if it

hadn't hadn't been happening I would

just be talking about it conceptually

but now we're going to have a a

real-world example of what this implies

and when you own your analysis when

there's uncertainty okay when there's

uncertainty in the market place or did

the global economy

you know arena the participants get

really really spooked

okay and what will happen is the large

institutional traders okay many times

will scale back their risk they'll

reduce their position sizes or their new

trades

maybe they'll they were gonna do a large

block of orders to be an accumulation of

a by position maybe they're still

bullish but because of the global stance

against you know this potential strike

and the implications that may have on

the markets maybe they have reduced

their overall exposure by saying well

and we're gonna buy it because we funnel

I fundamentally think it's gonna go

higher or lower okay

they just scale back that and that's

something that you should do as well so

what do I mean by that what means number

one scale back the level of trading

leverage you're using because anything

can happen in these types of

environments okay but what'll generally

you'll see happening is there'll be a

lot of range bound trading and spiky you

know consolidation but there's still

opportunity to trade in that environment

you just got to lower your expectation

slow down in terms of what you expect to

see in terms of time okay and expect to

spend a whole lot of time in the market

moves okay like for instance if one of

us a buyer here on Tuesday you'd have to

sit through a long period of time before

we got into the New York open on this

day here of the

September 4th before the part the price

you know released the upside now if one

was a seller okay you'd have to rely

more on these resistance levels okay and

stick true to trading only at or very

close to these levels meaning that if

the market environment suggests that

it's a lot of uncertainty okay there

would be times where it may be the price

moved up here off these keys

since level and traded lower and then

gave a retracement and maybe I would

trade something away from that level

okay on a more kamar global arena okay

when there wasn't so much in certain

team because of potentially war breaking

out in the Middle East and the

implications that has I would not be

willing to trade far away from these

levels and continue to move lower

meaning that I would miss these little

small little moves in here because I

don't care about trading out here in

this open space between this level here

in this level here I would be more

inclined to be trading at these levels

okay and you can see when price gets

these levels the reactions it has okay

and that's what you want to be focus on

focusing on the the impact of these

higher level timeframe support

resistance levels and applying that to

your training only trading when it gets

to those particular levels and a

confluence of other supporting and

indicators whether it be price

indicators or economic indicators to

come around in terms of your economic

calendar and hello have you been looking

at that you should be because those

things are you know very significant in

terms of trading ya know what's coming

down the pike guys so let's go in here

and zoom in a little bit and go over

what had transpired here okay and we're

gonna use Friday two Fridays ago okay

and we're gonna use this price point

here okay

we have a price move down smaller

retracement another move down okay and

then a retracement okay so we had one

leg two legs and then a retracement okay

I know another REIT raid to this

particular level here at one thirty to

twenty level one Monday okay we were

still obviously looking for selling

scenario because we were expecting lower

prices based on a higher time frame idea

that we're gonna flesh

out here but we have a range hi here to

this range low okay

I'm going to show you this is the range

here from the low to the high of that

previous Friday okay now why am i using

these price points

okay well whenever we start a new week I

like to use discernible price swings and

this is discernable it's very clear very

distinct much insane capacity this high

down through this low is okay now you

could have your level from this high to

this low but I'm not expecting much of a

retracement because we're overall

expected bearish on a higher time frame

so the likelihood of the tree trading

all the way up to these levels short

could but I don't expect it okay so I'm

looking at price where we moved into

this consolidation and we broke down

we're gonna come right back to that same

consolidation okay price comes right up

into that 62 level and then trade it off

okay we're gonna use this same high and

this low here because this is a new

swing a price swing from this high to

this low it's a larger more dominant

price swing whereas this is a small

little short-term price swing and then a

retracement this is leg one leg two

together

okay so here's leg one and here's leg

two now if you look at the high down to

that low formed here on Tuesday we have

this high and we have this low see what

we have here price come right after that

sweet spot boom hit that right on Friday

I'm sorry Thursday and traded lower

moving into a low on Friday okay so now

what was up here that caused this

reaction okay that's one of the

assignments I want you to look at go

over your economic calendar

over your your charts on a five-minute

basis on an hourly basis for our and

daily okay really hone in on this little

area right here

okay the breakdown in the fiber or your

yes t as we would commonly hear it

referred to as this was the actual high

that was formed on the fiber and we

traded lower and right before that price

high okay I want you to see something

here see this low

okay let's zoom out just one stage

here's the high okay

here's these low so we're just talking

about the market broke those right there

okay when we see that that's generally a

sign that this market wants to break

down much in the same way you see it

here okay it broke the low here and then

try to rally up and was a false swing

and then gave up the ghost and went

lower well we have that same scenario

here okay and the reason why price was

expected to break down here is if we go

out to a daily chart real quick see this

old set of highs back here price went

just above that ran to the 130 450

figure mid figure I current rather and

then hmm traded lower when we had this

price pattern here these are referred to

as railroad tracks okay

and I like to see these types of

patterns because number one they're

pretty powerful in terms of

prognostication you see that happen here

and price gave a very nice retracement

here this is very tradable now obviously

when you contrast it against something

like this where it rallies out like this

or the rally here or the decline here it

doesn't look so dynamic but if you were

to look inside the range from this high

to this low we're looking at 168 pips

would you just throw away the

opportunity to make honor and 68

it's certainly not or at least you

shouldn't

so again dealing with these daily charts

there's a lot of pips there's a lot of

potential setups that are available to

one if you understand what you're

looking for okay because we're looking

at price and an old high here when

prices run up through an old high but

look at look at where the market head

came from we come all the way out this

low in the beginning of July and it was

basically a one-sided market we very had

very little retracements and it's kept

driving higher and higher higher now

I've got a lot of lines on this chart

but I'm gonna refrain from taking them

all cuz I'm gonna need them in a moment

but we have this rally up makes a swing

high then we rally up makes another

swing high and we rally you up makes a

higher swing high okay whenever you see

the moves like this

keep pushing higher higher higher into

an old high these are areas of where

heavy distribution is taking place now

I learned a pattern called the three

Indians pattern okay and it's basically

like a three drive pattern where you got

one high and higher high and another

high okay it's a very common pattern

it's been around forever and I can't

remember who really originated it Larry

Williams did some discussion on it but I

always just revert back to just you know

the street smarts book Linda and Larry

and now you can just google them up on

the internet again the books street

smarts in the pattern here you're seeing

is the three Indians pattern it's a

climax reversal pattern meaning that the

price is driven up to an extreme and

generally it's just right above an old

high or into an old high and then you

can reasonably expect to see price to

trade off now I'm not suggesting please

don't take this as this is the high of

the euro and it's gonna go down to hell

okay that's not what I'm saying here

okay what I'm saying is it's giving you

a tradable reaction that's sizable okay

we're going to talk about where we would

be reasonably expecting to see this

market

lower okay based on this understanding

here but looking at this high here when

we ran through that and gave up the

ghost on that candle right there that

was the faint sealer from me that we're

probably looking to see this market blow

out and go lower and then when the next

candle here took out the lows prior to

that rally okay that right there is a

break-in market structure that right

there suggests that this market is now

poised to trade lower so any rallies

from this point on should be suspect in

other words you selling you selling as a

mode of trading so don't be buying into

it expected to keep going higher now

will eventually sometimes do that

certainly will okay because I'm not 100%

but by far and large when you see these

types of events happen it does give you

an opportunity to trade short just go

back down to a fifteen minute time frame

okay and here's that hi here we were

just discussing them and it broke down

we see the break below the low prior to

that last rally up okay so now here what

we have is we have the range high to the

low once these loads were taken out we

have a shift in market structure now

what does that mean

well it means that we have a low to high

a low to high then we have a lower low

prior to that rally so we have a break

in what would be considered market

bullishness breaking down okay again

because I'm not a fan of support

resistance I'm not going to draw I'm

sorry I shouldn't say I'm very very

large famous partisan something's not a

fan diagonal support resistance in the

form of like a trend lines but if one

was to draw a trendline like this okay

one could say okay well here we have a

price point here we have a price point

here trendline breaks here comes out

retest goes to it's just a little bit

and then it falls off that's all fine

and great okay but I've seen many times

where these types of scenarios don't

even have any impact whatsoever and this

blows on through okay

so again if you trust trend lines go

right ahead and use them I'm not trying

to disparage those that do I'm just

telling you if you're looking for trend

lines down the diagonal support listens

basis with me you're not gonna find it

there's gonna be you know what you're

out I don't work with that so we have

this range here that's high in this low

okay and as price rallies on up in here

price goes right after that sweet spot

okay here's your 70.5 level unique to IC

t so here we have price react and very

nicely and then coming down giving you

several opportunities trading off of

that 62% recent level see that prices

having a very strong resistance around

that price point okay all of a sudden

the market breaks down again okay and we

start taking out the lows here and this

low here when that thing is you saw

you know it's all over with and you can

see that happening here the market

participants drive it lower and then

just didn't have any momentum whatsoever

at in terms of trying to come back and

we move low we're in lower lower

so now once we have this break-in market

structure in the front

price rallies up here okay what we will

be doing is looking for areas of

resistance or support breaking then

turning resistance where we would time

shorts okay

movie time shorts now let's add a couple

examples here but we're gonna apply okay

we're going to apply some let's go back

to the vertical lines here because we're

going to imply the weak phenomenon that

we like to look for Tuesday and or

Wednesday from the high of the week and

you see that happening here okay

but as price rallied up this is a

suspect rally why because we had already

broken down based on this loaf you know

forming lower on these lows here taken

out and the rally up is suspect and when

you start to break lower we have these

lows taken out rallies up now we have a

new range we have this high down to this

low see that now look at what's

happening here

price was working within here's your 79

percent 70 and a half percent and 62

percent all this time price spent in

that small little consolidation and then

price broke down it came back up broke

down came back up broke down came back

up broke down okay

again we're looking at a 15-minute time

frame now you could frame trades on that

or if you really want to reduce risk

okay you could zero in and go lower to a

five-minute chart okay and we're gonna

do that now we're gonna work within the

week of the seven what is that 24th and

the thirtieth so let's go down to a five

minute

and this is where price was

consolidating all around that area

and price breaks down here then rallies

up we have a hold high here we have old

high here and old high here watch what

we do here we're gonna use this high

here this is seven GMT this is

essentially the beginning of the

European session and we're gonna pull it

down to little low prior to that rally

up goes right to the sweet spot in this

candle comes in at 1,300 GMT that's New

York open remember we were talking about

how in the previous episodes where we

could see specific price moves unfold in

the two largest trading sessions that

being London open in New York within

those two sessions overlap but uniformly

inside of individual London and New York

there are particular price swings that

take place I'm going to discuss that

later on in this video but here's an

opportunity one could get short one

trading off of this resistance level

that was noted in advance trades down

off bounce off the support now notice

how price sweeps is just below it a

little bit okay and then reacts when it

bounces here okay not only is it

bouncing here to give you a rally to

sell into but if you're a scalper okay

if you're a scalper see this is low here

and it rallies on up it spends a lot of

time in here okay let's look at how much

of a bounce that took place we're

looking at about 35 pips or so of a

bounce so if you're a scalper here's

your higher time frame support level you

have an old low back here this rally and

then dips them okay it goes back to this

same little consolidation market

participants are gonna be really

sensitive to this area of interest in

terms of price data when price moves out

of the consolidation and it eventually

comes back down to it it's reasonable to

expect another reaction now it doesn't

mean it's gonna go right to the moon

okay but if

you are bearish and if you're a scalper

on a short-term you could buy into this

and if you're really nimble and I'm not

suggesting you try to be but one could

do what I've done very little of in my

trading history but I knew a few guys

that are very nimble like this they'll

buy this then go short on a reversal and

then ride the other way down I'm not

that good and I'm claiming to be that

good but I have seen it done a couple

years ago I was on a website forum and I

shared a live example of me doing that

very thing and I reversed on that time

and kind of like excited a lot of folks

that we're actually watching it live but

I can assure you that doesn't happen all

the time and I just happen to be lucky

on this one few rare instances where

witnesses were were present did so

here's an opportunity to be a seller

here and that was on a Wednesday okay

and we were looking for the market move

lower into Friday because the overall

Bears tone sets that that stage up we

have a resistance level here price is

unable to go higher okay trades lower

and it starts to rally up so what do you

think would be here if you pull your fib

you got to use this high not here use

the highest high around that level so

here's a high and again we're really

splitting hairs with this in terms of

the five-minute chart but you can see

that it does give some quality setups

and again if you look at this this is

your optimal trade entry and you'll have

to zoom in on your own chart because I'm

not going to do that here I guess if I

moved out this way a little bit you'll

see a little bit better yeah 60 to 70

and a half and 79% is the actual highs

of the candle and that happens to be

around the asian session so you could

actually call it very nice move in the

asian session which we're not gonna be

talking too much about in this video

series really relying more on the London

opening New York open sessions we have a

high here at 8:40 GMT and

hi here at 12:20 so we have a London

open swing high and we have in New York

open swing high and the overall

bearson's is again focused on because of

the higher time frame any rallies you

look to sell so here's a high to a low

put it on that low where it belongs and

price trades right up into the sweet

spot which is convert kind of confluence

of factors here we have a higher level

time frame support resistance level that

132 67 level ish you can go around you

can round that to with 130 to 70 or 130

to 60 small round number and not the

time of day that occurs it's 12:15 and

that's the New York open and then price

moves lower respectively then we have

again price trading at this one thirty

to thirty nine eleven called once or not

I'm sorry 132 for forty level or was

round to a nice round number we have

this range here trading off of this

resistance down to this resistance and

then there's a retracement okay and

pulling that range

make sure we get our candles okay we

have in here we have Asia making the

high the actual high formed on 1:30 GMT

this candle here is the 9:10 GMT that's

new I'm sorry to London open price

breaks down a couple different little

micro rallies in here and then finally

gave up the ghost at 12:30 GMT which is

New York open again trading right up

into that one 32 39 over 130 240 level

and then really fell out of bed and

again here trading in the same direction

intraday we have this resistance broken

I'm sorry support broken now resistance

and this small little range if you

looked at the high in the low of that

you'll get another small little

retracement for a London close

continuation pattern going into the low

of the day we have

the high here in Asia previous day's

high and low

okay price comes down rallies up into

the 62% race on level here and it's

confirmed by this same 30 to 20 level

which is nice level is 30 to 20 and

institutional level we like to lodge to

the 20 levels and an old low okay and on

this candle here that is 10:40 GMT and

then we have 945 GMT and we have 7 GMT

so all during the European and London

session we have several opportunities to

be a seller and to old

lows broken now resistance and then

market moves lower where would be

reasonably expected to see reach for

this old low and we're looking for

support resistance levels to aim and and

look for new targets again same scenario

here ok markets moving lower here is a

opportunity you could use King off of

that 131 90 level let's round that to a

small round number full fifth from this

high to that low you'll get a nice

retracement okay wrap to sweet spot and

sell-off and here same thing could use

for continuation in the same direction

intraday we use the fib on that for the

New York open

you get right up in that sweet spot and

awful trade entry and trade lower

intraday now that's if you are a day

trader okay and there's 45 pips or so

later your feet using that as an example

eventually the market bounces and trades

up into a previous range now we're we're

trading right into these resistance

levels but you see this high here this

low and here's leg one and leg two if we

use too high down to that low again

we're looking at market swings the

markets trading into the optimal trade

entry just fell short of this sweet spot

which actually comes right on top of

that 30 to 20 level which is nice I like

seeing stuff like that there's where you

got your setup so I kind of gave you

your answer for your homework didn't

mean to do that but sometimes I don't

have them guys

and there's your your tradesmen back

into going into Friday ok so that's what

has happened since the last time we did

our episode two in this series and how

the reactions and price levels are laid

at your feet they were in advance given

to you how to find them what was you

need to trade direction and how you look

for setups ok

this is what you do you go through

looking for support resistance levels

and you only take opportunities when

price gets to those levels and you look

for price patterns around that same

higher level timeframe support

resistance okay notice we did not put

any five minutes for resistance levels

we do not put in any 15 minutes poor

innocent level so we didn't put an

hourly support resistance level we only

used daily in a four-hour the higher

time frame

those are your timeframes where the

institutional sponsorships going to come

in okay so hopefully this has been

insightful to you again apply the tools

in a demo account setting and build your

confidence and you determine when it's

safe for you to use live funds

okay we are looking at a 10-year t note

daily chart okay and I'm sure you're

probably asking yourself okay well when

did we enter at the commodity realm well

I started as a commodity trader and I

learned from Larry Williams one of my

first mentors that the interest rate

market was basically the market that

controlled just about every market asset

class there is interest rates are the

driving force whether you're a stock

trader whether you're a commodity trader

currency trader oil trader it doesn't

matter what it is interest rates are the

absolute underpinning of market dynamic

moves up or down it's going to be more

or less it's going to be propelled by

the interest rate market now when we

look at ten ten-year tea notes there's

one small little extra I want to throw

in here I'm not breaking down my entire

bond market analysis concept it would be

I could spend eight series times eight

videos I mean 64 videos and still not

scratch the service on the the elements

of interest rates in hell one could

utilize those in in trading but I'm

gonna give you a real simple basic

framework where I'm sure it will take a

lot of ambiguity out of the market place

and for you as an analyst and your

trading and be able to use it in a

real-world environment because I'm

trying to avoid giving you information

overload and just giving you small

components that were very easily and

neatly fit together and it'll allow you

to have a better understanding of the

macro economic perspective that was

essential whether your sword term trader

swing trade or even a day trader we're

gonna be looking at the interest rate

yields now these are specifically going

to be you know the 10-year mark now they

can be shorter and longer term but for

FX purposes the tenure will be

sufficient so let's take a look at a few

examples on how we can draw this

information from the internet for free

with no cost to you

okay guys we're gonna look at some

concepts and utilizing the t note tenure

and we're gonna be looking at some

interest rate concepts and I want to

give you some free resources that you

can do this with and won't cost you a

dime except for your internet connection

all right just do a google go to bar

chart okay and you'll see bar chart com

okay that's what you want you want to

click on that okay when bar chart opens

up like this what you're gonna do is

you're gonna look over here and it's

gonna say select a commodity hit that

little toggle window down and you're

gonna scroll down to the financial

section here and you'll see ten-year t

note click on that and it'll give you a

few choices of contract months just use

the highest month here okay and in this

case is September okay when this window

opens up and go over here to customize

chart click on that okay and what we're

gonna do is it's going to scroll down

just a little bit and we're gonna do

some changes to this and what we want to

do is you want to be looking at daily

nearest click on that and the reason why

we want that is because it's going to

show a continuous non break in in the

contract as you can see here if I scroll

up you'll see these little spots on the

chart here okay

you'll see an absence of that by using

that that type of chart and we're gonna

go to a candlestick we're going to take

all the volume off it's not essential

for that here okay and we want to see at

least a year's worth and when I click

draw

okay and what we have here is a daily

chart of the ten year t note okay

and what I want to show you is there are

means of discerning where the higher

level tide okay okay and think in terms

of your a salmon okay generally has a

new trader your salmon you you want to

swim against the current because if the

market is going down okay it's probably

not gonna keep going down okay it's

gonna go up eventually things you know

tend to be contrary and as a new trader

so you want to fight against that tide

well I can tell you that's the salmon

you know the outcome of that is they

have fun when you get to the top okay

when they're right and they survive it

but they eventually once that's done and

they they completed their task by

getting there they all die a lot of

people don't realize that but the salmon

dies when it gets there so do you want

to be the salmon okay do you want to

swim with the tide okay and it's a kind

of silly expression or example or

analogy but it really communicates the

necessity of doing things the easy way

okay don't overcomplicate don't love or

complicate things and the surest way to

start that way of thinking as a trader

is where is the money flowing from is it

flowing into or out of currencies okay

and the essential question is how does

one arrive at that answer well you have

to look at a macro perspective okay and

the way we look at it macro perspective

is the interest rate market now the

interest rate markets are the absolute

center focal point of all economic asset

classes whether it be stocks commodities

you know currencies it doesn't matter

the interest rate markets with high

rates and moves everything around you

can argue with me all you want going to

tell you that's the case okay so if we

understand the interest rate market we

have everything

later our feet we have the keys to

everything you would ever want ok the

kingdom okay so if you understand this

you'll understand everything you'll need

to know on a higher time frame premise

okay so now I'm not gonna go into all of

my bond work okay so we're just gonna

look at just the 10-year T note that

it's gonna be sufficient for this

teaching series but I promise you there

are so many levels deeper that you can

go into and it's really not taught

anywhere on the internet my bond work is

absolutely unique and I'm gonna blow my

horn there's nothing like it out there

so I've given a few little things about

it in the past but man there's so much

more to it that helps discern what the

interest rate markets are doing on an

intraday basis on a week to week basis

on a daily if it's gonna be up or down

day there's ways of looking at that

seasonally and I mean there's this is

crazy how you know

rhythmic this interest rate market is

now with that understanding okay if we

look at a ten-year tea note market this

is a chart of a daily futures contract

of the ten-year t note if we see price

in this case trade lower here okay

what is that telling us well there is an

inverse relationship between the futures

contract and the actual bond yield okay

the yield that the 10-year note is

yielding is actually in this case here

it's going up okay when the tea note

futures contract is rallying as it does

here the yield would be declining vice

versa when we see the futures contract

for the 10-year note trading lower that

means that the yield is going higher

when the 10-year treat tea note is

trading higher here that means the bond

yield for that 10-year note is going

lower then we have a drop lower and

sustained move lower that means

there's a sustained move higher in the

bond yield now that's all fine and great

but what does that really mean

well it means this if you want to be a

buyer of currencies and we're gonna

stick to our equation of being the fiber

or your yes ting okay that's what this

teaching series is focused on it really

goes along you know with the other

majors too but we're just going to use

the euro if the ten-year Tino is trading

lower like this that means the bond

yield is going higher currencies are

going to be chasing higher yield so what

does that mean as the yields go up as

we're going to see in another chart and

how you can get that information as well

as the yields are going higher the

currencies are going to chase that okay

and that means they're gonna chase yield

what does that mean that means while the

10-year note is trading lower you want

to be a buyer of currencies okay now

take a big step back now go back to this

price action here if we see price trades

lower and then rally up into a level of

old support broken here is resistance

keep on going over here now this is no

resistance right if you look at the high

down to the low we've essentially

retraced back to will be considered a

deep enough optimal trade entry I'm not

gonna put the fib on here you can do

that you have to subscribe I'm not going

to key in my my information for bar

chart calm but you can set up an account

with these this website it's free

absolutely free does not do anything but

require you to have a email address okay

and my advice is to create an online

email address that you use for all of

your your trading related things and

that way everything that gets spammed

because you eventually will get spammed

I'm gonna tell you that I have gotten I

should say I'm kinda shy Bryce eaves

rather some spam ever since I signed up

to this service but if that's the small

consolation and in terms of accessing

free commodity charts that I like

this is certainly in one way of doing it

so I don't work with the email address

you know ICT at in a circle chair comm

or my inner circle traitor gmail account

I use the completely alien means of

signing on to this this website and a

few other ones that I like to use but as

price rate rallies up into this area

here we have an old level of resistance

which is support here okay we could

expect to see prices trade lower now

what if we could have an x-ray view okay

imagine if you had an x-ray machine or

x-ray remember as a kid and maybe you

guys in the states knew this growing up

his kid they had these little things in

the back of a comic book where it had

x-ray glasses okay and of course I was a

sucker and I spent my dollar 25

allowance and sent it in here and I

bought myself a pair of them and when I

opened it up it was ridiculous it was

this optical illusion it gives you the

impression you're seeing you know an

x-ray view but there is a way of looking

at the market on interest rates okay so

you can see where the tide is changing

and turning now we're going to come back

to this chart but for another free

resource we're going to create another

tab okay and we're going to go to do a

10-year bond yield chart okay when you

click on that you're going to again look

for in the list

u.s. generic government 10-year yield

analysis

okay you see that you're just gonna

scroll down a little bit you want to go

and go to your chart here not a snapshot

you want to go to chart okay and just do

a year okay what we have here is the

fluctuations of the actual yield okay

out the ten-year Treasury market now

watch what happens let's go back to that

ten-year Tino chart price made a high

here in April and then going into May we

made a higher high you see that okay

then we made an ultimate high in the

t-nut market and traded lower let's go

and you see a converse relationship here

in the yield okay

here's that low and then a lower low in

the yield again thinking inversely here

okay all we did was have a mirror image

of that happening here okay and then

there's been this rally up or sustained

move in the bond yield so as the bond

market I'm sorry the interest rate on

the ten-year has been moving up okay

that means that the currency markets are

gonna be looking to rally okay that

means they're gonna be looking to go

higher so now as a higher level

timeframe institutional sponsorship

minded trader

it's like that's what we're trying to

cultivate in you right now you want to

be focusing the majority of your trading

okay now here's one of those note pad

moments when you want to risk the

maximum amount of leverage that your

personal risk appetite permits okay and

let's put it out right now

do not risk more than the industry

standard 2% per trade or maximum account

exposure at any one time okay and we're

going to say that that's the case here

you have the

like go to be risking 2% or whatever

your maximum is in your demo account

again cuz this is for teaching purposes

only and not giving you trade advice you

have to determine whether or not this is

useful information to you and if you

trade on that with live funds it's

completely 100 cent your responsibility

you collect all the success and

accolades I don't want none of it okay

so by looking at this type of scenario

you could be a maximum risk trader as a

buyer okay and what does that also mean

for being a short sell if you're an

intraday trader don't risk maximum okay

because the higher level timeframe tide

is poised to be moving higher why

because the yields are going up and

eventually the currencies are gonna try

to snap up and chase after that yield

okay so what does that mean well let's

look at April and May time period in the

euro now obviously once you set these

once you open your charts up like this

you're going to be wanting to save them

in your favorites tab okay I have one

for the euro for the bond I'm sorry for

the British Pound for the dollar index

and I have one for the tenure t note

okay here is a weekly because that's

what I save but we're gonna go down to a

daily nearest and note nine months of it

and we're gonna draw the chart

okay and I left the co T data on there

but uh yeah you guys know me I'm nuts

about stuff like I gotta get it off

it'll distract me
it's case I just took that off and now

what we're doing is we're looking at the

here's the April and here's May time

frame where the euro did what we made it

low here came down made it low traded

higher came down in July ran out the

lows here but this right here was

suspect why because the yields were

going higher okay so while we did trade

down to these levels okay those that

were watching my market reviews okay I

discussed that British Pound was poised

to move higher as well all in these same

time periods and it was the case you can

see it happening and unfolding here so

we saw again the the fiber eur/usd pair

traded higher higher higher higher

higher higher and where to trade to an

old high blew it out just a little bit

but eventually now we're trading counter

okay what the yield markets are

suggesting okay so we could retrace a

little bit deeper and try to trade up

and fill this area here but bottom line

is is ultimately these are the types of

moves okay you want to be participating

in okay do you see the majority or

lion's portion of the market moves are

happening on the higher level timeframe

being a buyer okay very very sustained

long basically you know enemy it terms

swings are on the upside okay now

granted there's some profitability to be

made going short there's nothing arguing

against that here okay but we're saying

is is if you want to be directionally

poised as a trader and only focusing on

institutional level direction okay this

is one way of doing it okay

let's look at the bond yields chart

again now there is another opportunity

to look behind the marketplace okay we

talked about this x-ray view concept I'm

going to go to Google once again and

we're gonna go and look at the ten-year

German bond yield okay when you see that

you're gonna go to we got here sorry

German government bonds and then here's

it over here when you see gdb r10 that's

the one we're looking for okay

all I'm doing is opening that up so that

way I can cut and paste the symbol if

you want to have an individual chart

like this obviously you can do that you

can see now we have this chart now this

is showing the ten-year rate of the

German bond yield for ten years right

if you every time you open up a new

chart it'll give you your history okay

and what I'm only gonna copy that I

don't trust myself to remember it why

not get everyone this page and you got

to type in : IND okay and then what that

does is it compares the two okay so we

have the orange is the US 10-year bond

yield and you have the green which is

the German or which is closely

associated to the fiber eur/usd the

green is seen here now here's what I

want you to look at if you look at this

chart you'll notice that the orange okay

has a low here go

higher than goes lower again but look at

the low is higher than it is here you do

not see that happening with the German

okay the German went lower okay and you

probably see it easier if I went to

three years yes we went lower in the

German and higher in the US so comparing

the lows respectively

there is a accumulation going on and

it's seen with the US bond yield okay so

now if we go back to Google once again

and we do a ten-year UK bond yield chart

you mean looking for again the bloomberg

and it'll say government bond 10-year

note generic the Guk GU 10 IND okay I'm

just going to copy it from here and then

actually open the charts you can see it

so now say my clipboard I can just drop

it in well my first chart for comparison

reasons and you can see here change it

to a year you can see the same thing

happening here that the bond markets

yield turns on the dime in that same

april/may time period and starts

rallying up so now if we go back to diff

first chart where you have the US and

German I'm going to paste the UK and by

having the three on here you can see now

the orange makes a lower low then we

have here the red makes a higher low and

the green makes a lower low so there's a

divergence between the three okay and if

I go to a six-month now you really can't

see it's got to be seen on in one year

but uh my advice would be is you want to

pull this up every month and take a

snapshot picture just to a cream screen

capture and just keep a record of it and

you'll be able to go back and look at

where it diverged but basically if you

look at every three months or so there

is a shift okay there's a shift in these

these yields okay and you can see the

happening here in the beginning of the

year where the green or the German

tenure did not make a higher high

whereas the British UK yield did and

said that the American so that was the

shift when he started to move lower okay

so there is a continuous move up and

down up and down but generally around

the spring time there's a sustained move

- that moves throughout you this summer

and it's based on income tax and

portfolio dressing that goes along with

you money flow and moving things from

one asset class to another and new

overall basic level well you know money

system okay and it just repeats all the

times it's just it's always there if you

just look at the higher time frame macro

view like this it's very easy to get in

sync with the tide now just for

completeness sake okay we're gonna look

at the British Pound okay and we're just

gonna show you the effects again just

for completeness sake not to that we're

going to be utilizing the cable

and our examples but I want you to see

that the effects are similar with this

pair as well okay here's our April now

it actually made a low earlier in the

year came up here's a load as tradable

there's a male oh that was tradable and

we came down this is where I was telling

everyone in my market review in advance

that this level here was going to be

sensitive and we would see a buying

opportunity and here we are nine hundred

pips later it were up here and where was

it gonna go back to an old high why was

it rallying up like this and canoeing

pushing higher higher and higher higher

everyone scratching their head saying

what's going on it's because it's

chasing the yields okay and there's been

no clear disturb all means of reversing

in the yield market so therefore airs no

real clear sir noble reason to expect

this thing to reversing trait and blow

out this low so I would still be hunting

bullish scenarios longer term but

certainly not negating any short-term

intraday scalping or short-term intraday

day trading scenarios for being a bear

so now we have covered the tenure rate

so I'm sorry ten-year t note okay if you

do your analysis on this futures market

everything is reversed in terms of the

interest rates yield and if the ten

years going lower that means that the

bonds are going higher the actual rate

yielding the interest rate and if that's

the case the currency markets are gonna

chase yield okay so if the yields are

dropping they're gonna go on file it and

if it's going up it's gonna be following

it as well okay so if I spin cycle to

you and obviously you know it's gonna

take some time in a long time to learn

this concept because it takes a while

for these things to cycle through you

know on an annual basis and quarterly

basis but I promise you if you'd spend

some time it'll be absolutely a wealth

of insight that is not Glee Noble

anywhere only

okay guys we are looking at the time

frame section of this episode

now obviously you know it could be very

daunting for you as a trader especially

if you're new and you just sit down in

front of the charts and you're thinking

yourself you know what am I supposed to

be looking at yeah so see looking at a

five-minute chart

how about 30 minute chart you know the

guy I've read on the forum said he looks

at a two-minute chart and how about the

other guy he looks at a tick chart and

the other guy says he ain't looking at

anything but a weekly chart you know so

what do you do with all that well the

main thing is is you have to keep in

mind that whatever time frame you're

trading that's where you work within

okay so basically knowing your time

frame for your trade is your primary

objective now the professional

perspective okay that the frame of your

trade should be at least built upon

three time frames and that's what we're

teaching here I'm building a large

introduction into basically Alexander

alders triple screen approach with an

ICT twist so if we're us position trader

you would utilize the monthly the weekly

in a daily chart okay and you'll be

looking for monthly higher level time

frame support resistance levels and

reaction levels and weekly chart as well

and then keying off of the daily chart

for your trades now in this time frame

you don't need to be in front of charts

all the time in fact you're probably

gonna be trading very few setups

throughout the year but for those that

have really very very few hours of the

week to you know put into trading

position trades may be the way to go if

you are a little bit more free and you

have a lot more hours of available to

you for intraday or I'm sorry intro week

trading swing trades might be up your

alley

we use the daily the 4-hour in a

one-hour chart and that's really what

this series has been framed about the

daily chart and 4-hour chart really are

the institutional frames for your trade

setups and your trade ideas

the one hour basis you could you could

substitute that with a 15-minute chart

it's really up to you

okay there's that's where the level of

flexibility comes in now short-term

trading your high higher time frame

chart would be a four hour and the one

hour being your mid time frame and your

15 minute chart would be your execution

time frame and obviously for day trades

and scalps your one hour would be higher

time frame your 15 minute would be your

mid time frame and your five minute

chart would be your execution time frame

now at any one of these levels of time

frame analysis you can always break it

down further to the lowest form of

charting in other words you know it

could go down to a 1-minute chart now I

don't use one minute charts the lowest I

go is five minute and that's only when

I've really honed into a specific key

level and I mean either either day

trading or scalping which I don't do

very much of but most of my trades are

day trades short-term and swing trades

but that's the framework you utilize

when you're breaking down the market and

how you digest it

and if you're going to be a specific

type of trader if you work with these

three time frames as you as suggestions

I think they'll work well with you in

terms of your development let's talk

about cycles in the marketplace okay

we're gonna be talking about some smart

money concepts and some of these

concepts again go back to Larry Williams

and again he was one of my first

technical analysts quote-unquote Mentors

and one of the coolest things I learned

and it didn't really hit me until I

started trading the bond market in the

S&P but he taught a concept that's very

very generic and it goes right over your

head if you're a new trading and

thinking yourself what it's stupid or

that's not the you know exciting or

that's pretty obvious but it's amazing

how when you're trading are you looking

for setups you forget this phenomenon

the concept is basically how the market

moves from trading ranges or

consolidations to swings or trends and

they move immediately right back into a

consolidation and then after

consolidation people get sick and tired

of the marketplace they don't worry

about getting in or they chase

the previous move and that inside the

little consolidation or these rectangles

or squares if you look at on this chart

is iam as an example

that's where dealers and market makers

establish their positions okay

so we do not chase the market place we

do not chase price rallies we do not

chase price declines we work within

these consolidations smart money

accumulates during consolidations or

when the markets not attractive okay and

we're gonna build on this model as we go

through the series but it's very

important for you to start looking at

the charts with this premise in mind

are we consolidating because that's the

next that the precursor is the

consolidation then the next thing to

expect would be that a release that

dynamic thrust up or down in price

action where everybody gets really

excited
you see everybody ting about it you see

every analyst saying they had it right

you know for the last six months that's

really what you're looking for you want

to be in there before everyone else is

talking about it okay now we're going to

talking about the concept of power of

three okay and what this is is basically

a understanding of how the market works

on a daily range okay now we're gonna be

looking at this bar chart okay now

obviously and we we deal with

candlesticks a lot in my videos and

maybe in your own trading in your

technical analysis but for a couple

minutes out let's spend a few minutes

talking about how the open high low

close bar is beneficial now I'm not

going to give you a full treatise on one

disc because I have actually a tutorial

that I'm releasing that has much more

insight that I'm gonna go over in that

but this is going to be a brief

introduction the concept briefly is this

when the market opens up on a daily

range okay you as a trader you want to

be participating in large range moves

okay like we just discussed in the

previous slide you want to be entering

the market when it's quiet when there's

not a whole lot of activity or at least

when the ranges start to compress okay

when the range is start to get small

people get really bored with that mark

and they start chasing the next

or the next commodity market or whatever

it is it's moving around a lot that's

the one they're gonna move to well

during their small little consolidations

or small inside days or small daily

ranges that's when I get really excited

because I want to be in there when the

markets are getting real real quiet

they're like a spring winding out

tighter and tighter and tighter and

eventually something whatever the

catalyst is I don't always know or even

care but really to know what it is makes

the market take off and hopefully in a

predetermined direction that I was

positioned then before it takes place

that's that's essentially what you want

to be doing in your trading whether it

be day trading scalping or short-term

trading or position trading or your

swing trading whatever the style trading

it is you want to be getting in your

position during these consolidations and

contractions of ranges okay looking at

this example here on the left-hand side

of the euro this daily chart just stare

at this chart for a couple minutes and

you'll start seeing that how the ranges

get smaller

now excluding the small little

itty-bitty tiny little ranges that's

actually a Sunday candle so you kind of

got like disregard those but before the

ranges get really really big they

actually get smaller okay and there's

other examples of timeframes and sample

sizes you can utilize to better

illustrate this but I've been looking at

this for years and I can see just simply

looking at for a few seconds I can see

that the the pattern itself where the

range is gets smaller then expand get

small I can expand and get smaller that

phenomenon okay is one of the truest

cycles in the marketplace and it goes

over everyone's head they don't pay

attention to it and many times when they

hear me talking about it it's like well

it's pretty obvious is it really obvious

because the last few times you took a

trade maybe there are losers did you

take in consideration what was going on

did you chase the market after it

rallied up 60 pips okay but without any

kind of retracement or whatever that's

the nature of this de cycle okay and

some of the best money can be made

simply with just applying the

consolidations to trend or swing

component we just discussed in the

previous slide and adding when the daily

ranges themselves get smaller so inside

there's larger

consolidations okay or rectangles where

the trading range market environment and

develops inside that trading range if

you start getting small inside days or

small little daily rains is getting

smaller than the previous days then you

have a really good scenario where it

sets up where there's going to be an

explosive move one day two day three day

up or down event if I want directional

bias that was the precursor going into

that condition but now let's break the

daily bar itself down looking at the

opening assuming that we were looking

for a up day okay or in a bullish

scenario generally speaking if you are

trading in an area where it's highly

probable for the market to trade up

maybe we're in a consolidation on a

daily chart or a 4-hour and then the

range to start contracting okay one

large range days this is a notepad

moment get this written down on your

notepad on large range days the open

tends to be at the opposite extreme of

the daily range opposed to the close as

you can see in this example obviously

this is an illustrative example I drew

with the computer but it's going to

communicate the the basic premise the

open generally is on an up day or the

large range with an update bias and a

closed typically sees the open at the

low the day or near the low with the

closed at or very near the high today

okay now look at the example for a

moment to the left

notice how many again this is a daily

chart of the Euro notice how many times

that the open isn't the opposite extreme

of the daily bar where the closes okay

there's enormous amounts of opportunity

within the daily range and that is what

you should be looking for you want to be

trading at the very minimum in the

directional bias of the daily range okay

we talked about the notion of having the

higher low form in the early part of the

week okay so that same principle applies

here just on a daily chart okay so now

what this means is if you're bullish you

want to be looking at the opening price

and looking at that as your filter so

you want to be buying not very much

above it if at all really

and certainly below it okay because what

you'll learn is the opening price very

rarely works both sides up or down

before going up I want to update in

other words price does not spend a whole

lot of time monkeying around with the

opening price if it goes down it's only

going down briefly for a very short

distance maybe reach low have some stops

maybe retest an old consolidation dip

into an old block of orders for

institutional purposes and then shoot

straight up and continuously work one

side of the market all the way through

the the trading session and then closing

off many times a little bit off to high

looking at the example you have here you

can see that just about happening almost

on a daily basis the vice-versa would be

obviously on a down move the open would

be very near the high and the close very

close to the low the general principle

is the low is formed briefly after the

opening on updates and the high

generally forms between 1500 and 1600

GMT put that in your notepad and then

you test that theory on your own going

forward for the next couple of weeks

okay let's look at a large range day oK

we've pointed out this one specifically

here

and this is one actually did trade now

admittedly I got out during the middle

part of the day because I had thought

that it was gonna retrace a little bit

deeper in and give me a better

opportunity but I missed it and I was

only able to catch the first leg of the

daily trend but this large range day

okay

came with the principles that we just

discussed okay we had the chart here on

the right hand side it's going to depict

a few things the first let's look at

this ok we have the beginning of a new

day here okay then the market Peters

around ok this is all Asia ok and this

vertical line delineate Adhir is

midnight New York time ok then you see

the market dropped down during the

European session into London then the

market takes off goes vertical goes into

a consolidation ok
and during this time what I actually

expected was it to retrace a little bit

deeper maybe come back down and to touch

this high in here but this was the New

York open trade here and then violently

traded higher going into the latter part

of the day and then Peters off from the

high and closes just a little bit off

the high but certainly a well way away

from the opening price and then after

this vertical delineation here this is

1800 GMT and I'm going to talk about

these two markers in a moment because

I've really never discussed this on any

other video or series or any kind of

discussion but I'm actually going to

highlight more insight as the y 1800 is

a very significant number then the

market essentially goes quiet going into

the new day now what is so special about

the midnight time frame of New York well

the North American continent doesn't

consider the new day like the FX market

gently calls the you know in Wellington

being the new new start of a new day I

don't consider that as a new day ok now

I certainly take in consideration all of

the Asian trading ok but and this is

going to be very confusing but I always

count that as yesterday's trade

my new day begins at midnight New York

standard time now again that's kind of

probably gonna throw a lot of yous off

but just understand this is how I break

the market down midnight New York time

to 1800 GMT time okay or basically 2:00

p.m. New York time okay that's the

cutoff of the daily range everyone asks

when's the close you know when there's

New York close or when does this and

when is that

let's talk about the commodity market

for a moment because before FX was

opened up to the general public

the only time you could really

participate in the currency market was

if you were trading the options market

or the futures and or midium contracts

on the commodity exchanges and it was in

the form of open outcry now open outcry

still in existence today not as

predominantly as was years ago because

everything's slowly transitioning to

electronic much to dismiss once to their

dismay but there is essentially a rhythm

to the marketplace still based on that

open outcry now put this in your notepad

currency markets okay or calm dolls okay

that means the commodity markets that

trade on the futures contract basis that

means Australian dollar Canadian dollar

British Pound Swiss franc Japanese yen

okay those currencies okay are calm down

they can be traded as a futures contract

the futures contract open outcry pit

begins trading at 720 New York time now

what do you think so significant about

that time that's 20 minutes after the

beginning of our New York open kill zone

okay why is the New York open kill zone

so cool and so easy to trade is because

that market event open outcry also is

going to be involved in the daily range

okay why 1800 well because at two

o'clock in the afternoon in New York

time the open outcry pit closes and they

are gone for the day and you can see

here that clearly is illustrated there's

no more

volatility very very very little

volatility all unless there's an FOMC

you know interest rate announcement

which typically comes in around two

o'clock in the afternoon you know in

late in the afternoon where it really

nobody should be trading anyway so will

you miss some moves certainly if he FS

if you're really involved in trying to

you know gamble trading those types of

events like non-farm payroll I can

certainly do without trading one Friday

out every month

okay I don't really care to be a part of

that roller coaster I can trade it I

just choose not to but if you bracket

out your days like this okay on an

intraday basis I think what you'll start

seeing is there's a clear symmetry to

the market that goes unnoticed by 99

percent of mentors or gurus or teachers

or even traders and this is the actual

daily range that goes on every single

day if you understand how that works you

can see this the open the down move to

move up the high and off the close and

that's what you see here the open the

down move the high farming and then off

the clothes I mean off the high as a

closed so that's what we're looking for

when we're trading intraday or getting

positioned during up word bullish market

environments okay let's talk about kill

zones okay and first we're going to talk

about it in my time zone which is the

Eastern Standard Time I live on the east

coast of North America in Baltimore

Maryland and basically we're looking at

the European and American session we're

not going to spend too much time there

actually a really any time at all really

talking about Asia or Prasad the Pacific

Australian session because it's

basically the quiet portion of the daily

range and really when markets are

accumulating new orders okay and we'll

talk more about that later on in other

episodes but for now understand this I

generally start hunting during the

Frankfurt open which is 2:00 a.m.

and many many times you'll hear me

commonly call to a in the beginning of

the London session

and that's either because I'm rushing

trying to talk about something and

really just inadvertently misquoting it

but just understand this when I get up

in the middle of night to start trading

in my time zone ok 2 o'clock in the

morning I'm in there hunting

ok but I'm hunting essentially the move

that sets the higher the low of the day

and I want to trade in a directional

bias for that daily range going into

London close and or 1800 GMT ok the

London kill zone I use 5 a.m. as my

close of shop in other words if I

haven't established a position by 5:00

a.m. my time okay I basically take a nap

and come back right before 7 o'clock in

the morning ok generally at 6:30 in the

morning I'm peeking at the charts and

seeing what's going on now for the

American session here you see 8 a.m. and

that's commonly what's been disclosed

with many other trading teachers okay

but if you look at your charts guys many

times the moves are starting about 7:00

a.m. between 7 a.m. to 7:30 a.m. ok and

now you understand why because the open

outcry pit starts at 7:20 a.m. New York

time so there's a reason why there's

something that you generates a signal

there or a swing high swing low that can

be incorporated on that daily range to

trade intraday setups whether it be

scalps or day trades and I usually close

up shop anywhere between 1500 to 1600

GMT generally 80% of the time and then

when it's really really taken off and

just blowing out all objectives I had

for the day I'll leave a very small

portion of the trade on for 89 of GMT

but very rarely does it ever happen many

it most of time 80% of the time I'm out

of the market by 1600 GMT so between

1500 and 1600 GMT that's uses the

clothes of the day for me that's where

not usually you'll see the higher low

form for the day ok folks we're looking

at the euro USD it's a 5 minute chart

and what I have delineate it on this

chart here we have these red dashed

lines ok and green dashed lines ok now

if I keep my mouse right on top of it

it's going to show the ICT Asian range

and what I've done was simply uh if you

can pull up the indicator and I edited

the beginning and end of specific

windows of time this is the London open

kill zone did I trade with begins

stalking setups for the European session

at 6:00 GMT and as late as 10 GMT and

for the New York open I made it real

easy and something that's generic you

guys can use over and over again 12 to

15 GMT ok 12 to 15 GMT took out all the

subtle nuances that make me use 30

minutes dividers and such I'm just

giving you a block of time 12 to 15 GMT

and that'll give you everything you

would need for the New York open session

now when you have this on your chart

okay okay I'm sure you're probably

asking yourself you know what's great

can I have that indicator - I'm gonna

supply it I'm gonna add it to a file

server and if FX gears comm could could

allow me to host it on the thread I'm

doing there that's wonderful if not I'll

get with Jack and see if he could hook

you guys up so you guys can download it

and a couple other indicators that we're

gonna be employing in this video series

now what I want to draw your attention

to is that I want you to see the highs

and lows that form during these

particular sessions this is the New York

open session and the London open session

the high of the day formed during the

London open and the low was essentially

almost formed during the New York

session going into that 1600 hour the

next day okay we have a nice tradable

rally up into this area of time it was

just outside of it by two two bars here

or in other words ten minutes and then

it sold off we have a nice opportunity

to get in sync with the daily trend here

with a high forming and

New York open and making a move lower we

have the low forming in London and then

another tradable low off of the

direction formed from the in London open

here is the New York open trade and this

happened to be one that I took part in

in a live trade so this is the scenario

I'll go over this because I haven't been

doing video reviews in a couple weeks

just give you this as a it's a highlight

ok the price made all these multiple

stabs lower and showed an unwillingness

to go lower

consolidated found it low in London open

trade it up and retraced into the New

York session going into optimal trade

entry and a sweet spot and rallied on up

now if

you use your Fibonacci tools

use your 162 extension nailing it for

the high and we'll talk more about

targeting and an exit prices and all

that stuff when we get into later

portions of the series but you can see

how the London and New York open kill

zones here gave you very nice

opportunities for a set up here we have

another scenario where using the

previous day's low okay and all we're

doing here is highlighting the

importance or the influence that the New

York and London kill zones provide for

setting up opportunity to trade this

area here okay doing the London open we

retraced inside this range here and then

where we had this consolidation and the

market moved out of it this this

placement can only happen when there is

a large entity behind the move okay

retail traders will not cause this okay

and then price retraces back into it and

then what to do it rise up again and

where's it rally to to take out old

highs in here that were to clean okay

this is way too clean and probably

stabbed up in there and gave an

opportunity to take profits if you were

a short term scalper on the long side

but the bias was lower okay and we

talked about earlier you know how it's

important to focus on his higher time

frame key reaction levels and that was

the reason why we saw this really

explosive move lower the high form

during the New York open session and a

low actually formed in the New York

session as well the following day we had

a short term high formed in here but a

tradable low formed off the fiber ended

New York session making the high here

and in closing the week out as we see

the kill zones are where

you bracket in terms of time now by

itself doesn't do anything for you you

have to have an understanding of support

resistance and key music reaction levels

and directional premise to frame your

trade on but inside these little pockets

okay

and really it looks like this if if it's

hard for you to see it's this whole

window right here of time inside this

block of time is where the scenario of a

trade should form okay and the same

thing goes for the London open inside

this area or a small little pocket of

time in price that's what the scenario

is going to unfold for you to take a

trade okay so it allows you to really

hone in like a scope on a rifle like a

sniper to zero in on where you should be

sitting down in front of your computer

okay if you're a London open or London

trader this is where you do your

business okay if you are London trader

and don't trade or in in New York

session you're cheating yourself because

there's a lot of times the setups that

you may have missed being incorrect or

just miss altogether will give you an

opportunity again sync with that move

during in New York session Mike my best

advice as a mentor would be to really

try to learn that New York session it's

very comfortable traded as a North

American trader unless you're on the

west coast and if you're out there on

the west coast you know that's just

something you know that's gonna have to

suck up because there's no nothing more

about it that I can say that you guys

got generally very favorable weather so

if this is the thing you got to trade in

for it and haha so anyway the New York

session obviously to me I think is the

easiest one to learn it's the most

forgiving because it gives you the

london session behind you as a you know

a catalyst joseph rain your trade off of

so if you have a higher time frame

support and resistance level noted a

directional premise in mind and then you

have you know the london session can you

in that same direction me and you have a

loaded deal as you have here in this

example on the

fourth of September the let's take all

this stuff off actually if you have any

doubts that there is some significance

behind these particular windows of time

it's gonna be your homework to actually

go through the next week okay and have

those time windows bracketed out again

for new New York session it's gonna be

twelve GMT to 1500 GMT and six GMT to

ten GMT for the London open kill zone

and for those who have been following

for a while if you notice there's a

slight difference in those windows I

just did it for this teasing series

because there's a lot of members of

effects gears it's not familiar with my

stuff and I'm not going to be populating

their website with all of my videos so

I'll just more or less made it user

friendly so that way you guys can have

generic time windows to work with and

they'll be very friendly to you there's

nothing gonna be missed outside of those

windows of time but if you do this for a

week okay my advice is that to see what

happens during these windows of time

okay and when there is high level higher

time frame reaction level around these

same pockets of opportunity in terms of

time kills urns and then you'll see a

confluence of events unfolding that if

you miss it will find out more about it

in the fourth installment because we're

going to go over the examples but really

I want you to see what you think may

happen based on everything we've covered

so far it's not a test

okay says a learning opportunity for you

to familiarize yourself with price

action

okay we are looking at the ICT market

maker by model okay

this very crude depiction of how markets

move on a fractal basis okay

generally what you'll see is the market

will open inside of a consolidation or

trading range and not open but don't

enter a trading range environment

now this by model is really universal it

could be applied to any time frame but

we're going to be basically looking at

it one the four-hour one hour 15 and

five-minute basis okay and what will

happen is the market will move out of

that consolidation trade out of it then

come back and many times retest that

first consolidation okay so if you miss

the accumulation portion of the first

wave down you can get back in synch with

it by waiting for this retracement up

okay and this the swings aren't

generally in this example aren't really

uniform in other words this could come

up a little bit higher into the range

from this high here to this low and give

you some kind of a 62 to 70 percent

tradesman level not necessary but

there's other factors you could hunt in

here to set up a scenario to sell short

if you want to participate in the first

leg going lower

once price comes down into a resistance

level or support level you know an

inversion level where maybe this level

was possibly an old level resistance and

my market broke through came back down

now into testing and support basically

when prices comes down to a clear level

of support rather we could expect the

market to turn around now it doesn't

mean we just go in here start buying it

up you can but I don't generally teach

that as a means of doing it after some

years of training and trading real time

once you get some experience and in your

belt you may be able to take trades like

that but that's not

what I'm illustrating in these videos I

want you to wait for some confirmation

confirmation comes in the form of a

break-in market structure and it moves

higher and then many times comes back

and gives you an opportunity to retest

that first consolidation in here after

the climax reversal pattern it forms at

support rice will come up and rally out

of that again move into another

consolidation okay and we could be

working off the levels that was formed

over here okay so whatever timeframe

this pattern forms in okay you're gonna

be utilizing again same premise of key

support resistance this will be another

continuation pattern also what would be

expected as a climax reversal by setup

down here off of a higher level time

Frankie support when the secondary by

scenario happens here or it just makes

one okay that's why these two boxes are

blue generally it can be one or two

small little pauses or consolidations

and then there's a explosive move up to

take out the highs above the first

consolidation okay and the premise is

this the market makers start building up

orders in here okay any hole price

within a clearly defined range there's

not enough buyers that keep it in higher

and it's not enough sellers to take it

lower so what'll happen is is that

market makers keep it in a tight range

to accumulate positions okay now what

they want is to hold the market in a

holding pattern to establish a premise

for them to take market the other way

same thing can be seen here just in

Reverse on a market maker sell model we

have a consolidation and the move comes

out of the consolidation and the highs

of that consolidation are usually

retested now again it doesn't always

have to happen like that but we expect

it to happen if it doesn't come back

down at least many times it will give

you some kind of a small little pause in

here or maybe a bull flag formation type

thing and then it'll rally up into a

clearly-defined resistance level inside

of that resistance level there will be a

climax reversal pattern okay

many times you'll see

okay here's a little notepad moment for

you if you want to see when indicators

work like they do in the textbooks okay

if you see this pattern here unfolding

like this and trades up into a

resistance level many times you're gonna

see your standard divergence of the MACD

your stochastics your RSI your CCI you

know spaghetti whatever it is you use

for your indicators if it causes the

divergence for a buy or sell signal

you're gonna see it form here okay and

then just think about it if this if

these indicators didn't call major moves

we never would paying attention to them

and the only reason why we pay attention

to them is because they work on the left

side of the chart we can see it it it

did it the last time right so it's gonna

do it again but nobody understands the

reasons behind why diverged okay and

it's based on the higher time frame

resistance level and the fact that the

dealers market makers have taken price

off there and they stabbed that price

level over and over and over again to

distribute the orders that were

accumulated here okay so they're buying

it all up in here okay they're

distributing a little bit here they're

distributing a whole lot of it here to

dumping it okay and then when the market

pulls back a lot of traders review this

area as a another continuation pattern

much in the same way it does here okay

well maybe this is a bull flag okay

and what they'll do is they'll buy it

with the expectation is going to

continue moving on higher but what

happen is is they'll have buyers you

know in these small little areas of

dealing ranges that we're gonna discuss

later on and what will happen is they'll

pair orders up and stack up all kinds of

shorting opportunities and they'll

distribute the market very heavily and

will happen is once they get a block of

trades on the other side of their

position essentially they will do a real

quick repricing and it'll trap traders

and what'll happen is is it you've

you've done this before and you know

exactly what I'm talking about even

those guys and demos you put a trade on

okay maybe you bought it up in here

something like that okay and the market

drops down hard okay and you're thinking

okay well maybe it's just gonna come

down here and retest some resistance

turn support

resume up okay then you start seeing

this little pop-up here and you get

excited okay and get Ringo back to break

even but the dealers know that okay the

market makers already have these folks

trapped and if you went in there and you

bought you're trapped just like they are

they don't want to give you an

opportunity to get out of that trade

okay

they're gonna keep you on a negative

float okay you're gonna be below and the

dealer spread okay and maybe even pips

you know and negative beyond that okay

and then what happen is they'll do

another repricing and now here's what

you're gonna do guys okay well we're

just retesting this whole area in here

again and we're gonna find some support

but it blows through it

okay the dealers will go into another

consolidation thinking okay well I know

what this is this is one of those

retracements where from the low up to

this high we got one of those ICT

optimal trade entries nope not here what

will happen is is there one more time

they'll run it and got it lower and

they'll take out the stops that are

placed when the folks that were right

that bought this rally here and this

held on for too long okay so there it's

an accumulation so the distribution here

or reach cumulation for new Long's okay

and then when they get up here they

distribute all of this in here but they

do it very quickly that's why when you

get up to these levels price doesn't

stay up there very long why because

they're doing a massive distribution and

you see the price really drop off fast

but when it drops off it'll do it give

you a little bit of consolidation one

more rally up when it gets on the other

side of that that the zenith of this

price move when we get to this start

rallying up this is where you start

selling okay and if you kind of identify

this pattern it makes your trading a

whole lot easier because you understand

what they're doing and where they're

taking price

okay guys we got some key levels here

noted on our time frame of a daily chart

and we're gonna give some examples of

what is a market maker profile I'm gonna

give you a by example and some sell

examples and the way you utilize them is

obviously you have have a hard time

frame support resistance level but they

can occur on any time frame but the more

apt to occur on a daily for hour and or

hourly timeframe and then if you have a

understanding of what their directional

premise is one of lower time frames you

can use them 1 1 5 15 minute 30 minute

and hourly charts and such but for now

we're just going to give you examples on

finding off of a daily time frame see

price trades down into this level here

should old support and all we did was

around it to a 127 60 level it just

calibrated the level to a round number

we're gonna look at this area here for a

buying market profile for market maker

profile and then we have one in here

trading into this resistance level okay

and then we're going to go and look at

the sell scenario that we called no last

video and how it was a market maker sell

model okay so what we're gonna do is

we're gonna look at this particular day

and the actual candle comes in at July

9th 2013 and we're going to start with

an hourly perspective on it okay and all

I did was use this to highlight the time

okay we have

okay market in a consolidation okay we

have a consolidation here market breaks

out the consolidation and retests that

same consolidation here trades lower

okay and there's a couple minor little

retracements to get in sync with that

move lower making the actual low here

and then the false swing lower this is

the actual high well I'm sorry the

actual low point of the market maker

sell model in here okay and then price

we rallies through takes out this high

here and very little pausing at all in

here it just explodes and where's it

explode to above the consolidation in

here okay so again the same price model

here in this fractal pattern is seen on

a hourly basis you can see ultimately it

comes back and trades even further if we

go and look at the daily chart again and

we're gonna look at this example here

for a sell okay right in here and I'm

gonna zoom in so you can see this candle

right there okay

these levels of key support resistance

on the higher time frame would be noted

in advance as house price trades up into

it we would expect to see market makers

sell model unfold and let's go down to a

15-minute

okay you see that happening here and

let's actually go down to a five minute

see a little bit better and just take

this rectangle office it's no longer

needed okay we have the consolidation to

move out of the consolidation and then

retest now this part does not have to

happen okay but generally you'll see it

happen and then there's a continuation

moving up makes the high or the

capitulation portion of the by model now

it turns to the sell side of it okay so

we are now at a market maker sell model

profile and we would expect to see this

consolidation ran out as you see here

market moves down solvation Lin here

another break lower or is it trade to

below the consolidation where cumulated

positions were taking on and you can see

ultimately that's the the price model

right there okay and let's go back out

to a daily okay we're gonna look at the

134 30 level okay see this high here the

lows in here and the bodies of the

candles as well so we have 134 30 small

round number it's just above this high

as well and we're gonna zoom in and look

at this profile right here and as price

moves up into these levels we would

reasonably expect to see a market maker

sell model we're gonna into an hourly

timeframe yeah and we're gonna zoom out

okay we can see the consolidation let's

take these vertical lines so I'll clean

it up a little bit you can see the

consolidation in here

consolidated moved out came back

retested the consolidation moves on up

false rally higher breaks down rallies

and again on the other side and again

this is the cell model so again this is

the cell model so you're gonna see

price run out this consolidation on the

line you can see that happen there okay

so that's the market maker sell model

and again we called this market lower

here before the actual move and sued

given some further credibility to the

analysis concepts and it's not always

hindsight cherry-picking

alright let's talk about market orders

and how dealers work within the

marketplace and how they perceive

traders psychology and how you can

pretty much get close to what they're

doing without even seeing the order

books alright we're looking at a

conceptual idea of what market price is

right now and we're not gonna have a

chart we're just gonna conceptually talk

about the generic principles associated

with how reading the market alright

let's assume for a moment the market

price moves up to what would be

considered a key level okay or could be

moving down to a key level it doesn't

matter but we're saying for the moment

right now we are trading at a highly

sensitive price point that reacted most

recently or maybe a couple weeks ago

there was a significant reaction in that

same price level so now market moves

whether it be up or down we now have a

market price that's equal to or very

close to that key level the question

comes to mind is where do we go from

here do we move higher or do we move

lower when you're watching price what

you're going to be looking for are clues

okay there's gonna be a fingerprint if

you will of what may be unfolding and

generally what happens is above the

market price okay there are protective

buy stops on those that have maybe put

on net short positions and many times a

simply above that just a little bit more

there's gonna be pending sell limit

orders for those that have been possibly

being long okay in other words we have

net long traders in the market and we

have net short traders in the market the

net trader on the short side want to

protect our position so they're gonna

have their protective buy stops

somewhere above the market price and

again the premise is is this market

price is now trading at a key level okay

and because traders always have a

differing view if even if the

marketplace is a implied support level

folks may be really looking to sell

short okay and we're gonna talk about

that in a moment but for those that have

solved this level as a potential support

zone and they want to be expecting some

kind of a bounce up they would have

pending cell limit orders to exit some

of their position end or all of it did

for a profit and then obviously folks

that expect to see it go up only if it

proves a little bit more that it's gonna

move upwards they'll have a new long buy

stop okay so in other words we have

three types of orders that exist

generally above current market price

that being pending sell limit orders for

those that are net long protective buy

stops on those that are net short and

new potential buy stops for those that

want to enter on buying strength on the

converse side obviously you have for

those that are buying this this

particular price level you have

protective sell stops protecting what

they believe there's a potential buy

scenario unfolding then you have sell

stops that are resting below the market

price for new short selling so loads

they want to sell on weakness and below

that usually you have pending limit

orders to be you tripped for covering

short positions okay in other words

they're using that type of order to exit

one a profit target objective for short

positions the question is where are we

most likely building up orders okay and

it's very tricky in the beginning

because you have to spend some time

looking at charts okay this is going to

come with time and when you hear me talk

about in a lot of times that you'll hear

me in my market review videos or

sometimes in my teaching videos I many

times I'll talk out loud okay my thought

process is this isn't always meant for

you to be taught what I'm always

speaking okay in other words I may be

thinking out loud about a phenomenon

that may be unfolding at a particular

level

okay and I'm not really meaning to teach

that to you because it's something that

you're gonna have to drill overtop of

charts to learn on your own okay and

this is the part of the experience

factor that comes into play and why

patience is so important because if you

don't have patience you won't give

yourself the time to develop this knack

because that's exactly what this is I

don't have an order book I don't have

access to you know what these orders are

outside of what everybody else has on a

retail level okay I can make phone calls

and ask where orders are stacking up but

that's only really limited to a certain

portion of the actual marketplace so the

psychology behind price action is very

readable okay and it's by using these

simple six types of orders around market

price obviously if price has moved up to

a resistance level okay one would expect

new sellers to come into place and then

there'd be protective buy stops

established and those that have been net

long they want to be getting another

position and they're greedy they want to

be trying to get that extra little bit

of drops of lemon juice out of that

lemon they want to squeeze it for all

it's worth

so let's try to put their limit orders

on the far you know side of particular

resistance level okay because it's freed

this market like anything else is a

breeding ground for greed and obviously

those that have been you know just

introduced to the marketplace they've

been seeing the market go up for nine

days straight so therefore if it goes up

a little bit higher that's when they

want to buy and that's the only what

happens is they buy the high the market

okay and I've been there I know what

it's all about and I know it feels like

so and you probably do too if we had

seen market price trade down to a key

support level okay those that are

entering in on whatever we implied as a

buy signal for them they would

immediately put protective cell stops

below the market price and then

obviously for those that have been net

short okay they have their limit orders

below market price trying to get out you

know with their greedy

you know expectations of getting out

near a very handsome price level to

profit from and again the same guys that

have been just introduced in the

marketplace yeah

twenty-five days in the marketplaces

been seeing lower prices so therefore if

it goes down a little bit farther then

they'll sell short and they'll have sell

stops down there because they can't me

from their trading desk because they're

working at you know whatever they're

doing you know you know painting cars

say they want to have their sell stocks

below the market place and it many times

you see them selling the low of the day

so let's talk about a little bit more

detail of how market makers pair orders

and how orders stack let's assume for a

moment that there is a highly sensitive

price level of support or resistance

around that one thirty two big figure

now when we look at a big figure okay

and before I go any further this could

be a mid figure okay and then obviously

the levels above it being respective in

terms of what we have here as an example

but keeping in true form of the

institutional levels we like to follow

which are the big figures the 20s the

80s the small round numbers okay in the

mid 50 levels okay if price trades up to

132 don't expect 132 to always simply

hold price back many times you'll see

price trade up to that level and

there'll be orders around the 10 level

and around the 20 level many times

you'll see price even if it's going to

go lower longer-term many times they'll

suite price up to the tens and the 20s

and the reason why is because folks like

to put their orders at odd numbers and

such okay but really the institutional

level traders they work around Ross

small round numbers okay

the tens the 20s they'll they'll use

those levels because it allows them to

clean through particular price levels

and maybe you've encountered slippage

okay in other words you you really

wanted to get out at 1:30 2:05 but maybe

they fell JIT at 1:30 to 10:00 that's

slippage why did they fill you at 1:30

to 10:00 because that's where their

order was for them to execute

so they're gonna fill you they're not

where you really want to get out at okay

it doesn't happen all the time no but

obviously we as retail traders are at

the mercy if you will of what the

dealers are going to give us as an order

okay maybe you had a trade executed and

you exited or entered and then you have

a recode later on okay

maybe you got in a short position at

1:32 even okay and then later on found

out that they quoted you 130 195 or 130

190 okay that's pretty extreme in terms

of slippage but if it's an economic

report things like that can happen as a

matter of fact you know I just recently

traded an economic report and I had you

know seven pip slippage from where I was

trying to get in and where actually got

filled so that's the inherent nature of

trading in fast it liquid markets and

they're gonna fill you where they want

to get filled okay so let me taking the

other side of your trade so I understand

that if you're dealing through a you

know market maker or an order desk

that's the type of filling you're gonna

get with your orders okay but if you

think in terms of the big picture of how

these market makers and large bank

dealer traders work they're gonna work

around these round numbers and always

expect them to try to sweep to the next

small little round number because that's

generally where they'll take price and

it'll clean out all the guys that want

to use a stop loss okay they may be a

sell short it 132 even I want to limit

and maybe they saw a price drop down to

130 190 and they're salivating because

they think it's going to go to 130 okay

so they put your stop loss at 130 203

okay well the dealers know that okay and

they're gonna take price up and just for

good measure gonna run up to the 132 10

level and that'll clear out a nice block

of trades that would have had pending

orders resting above it like we just

discussed in a previous slide and allow

them to promote liquidity not only for

themselves but other you know orders

they have to do transactions for

all right let's take a look at an

environment where the 132 perhaps is a

clearly discernible resistance level

okay and we're gonna assume that market

price is down here below that particular

price level and generally you'll see

this type of action okay they'll take it

up to the 80 level okay and price or

retrace pull off very sharply okay and

everybody understands if you've been

looking at the markets and the ending

capacity that the eighties the 20s and

the 50s and full figures are very

sensitive psychological numbers okay and

if the dealers can bounce price off

there they'll trap a lot of traders

thinking okay that was the high the

market then what happened is every price

okay and get folks that maybe didn't

believe that was the high and they think

it's still gonna go to 132 they'll more

or less by that market up okay but then

what they'll do is they'll take the

market below the most recent swing low

and stop those traders out so now the

folks that think on the short term that

the price is going to go to 132 are now

scared they don't want to get in the

market now so they took those

individuals out if they were taken out

when that recent move down below the

recent swing low here okay what is below

there they're gonna put a protective

cell okay if the dealers take the price

down below that that sell stop becomes a

market order to do what to sell at the

market who's going to buy it from the

dealers the dealers will buy up that

pocket of liquidity okay and then

they'll reprice and they'll take it up

to that 132 figure clearing out the

stops that would have been wrestling at

the 131 94 those that went short here so

now is there anyone short No okay so

where do they where does the dealers

exit their position that they

accumulated here at the 131 90 or

thereabouts because that's about rarer

those stop loss on the so the short

sellers here would have their orders

resting so they clear out the pending

orders and take it all got to the 132

figure the next repricing comes in they

sell off folks say okay well this is the

top of the market place so

start selling okay so they go sort here

all of a sudden you'll see the dealers

take price back up again now clear out

the 132 why because the folks that been

watching that 1:32 level once it trades

there at one time and starts to trade

off they think that's it it's a support

resistance is perfect it never never has

any blurry lines it's crystal clear

laser-guided okay and price is always

going to stop right on that zero zero

level it doesn't guys you got to have

some flexibility and wait wait for the

sure sign that this thing is going to

turn around so when they clear all the

way up to the one thirty to twenty level

now folks that were looking to sell

they're scared they don't want to get in

the market now they don't know what's

gonna happen

why because they watch the guys get

blown out here they watch the guys get

blown out here and this creates that

pattern three drives higher or three

Indians as it is in the street smarts

book they'll do a massive repricing

they'll take out the swing low here why

because there may be traders that were

net long in here and got you smart and

realized it was probably going to move

higher but they don't want those guys in

the marketplace either okay so they're

gonna drive them and the visuals out as

well and they'll take price back above

that one thirty two figure or tree at it

okay and this is typically when the

market really makes its pattern of going

short why because we have a breakdown in

market structure after we clear out the

orders that stack around these key

levels then you'll see price to amass a

dramatic repricing and take out all

short-term lows and anybody that would

be net long in that position and now

they're trapped the next portion is then

they'll get you know traders to think

okay this is it you know it was false

resistance level maybe this was you know

one of those patterns where it looked

like it was a top but it really wasn't

guys so let's get on board and they'll

do a real quick repricing up this is

where you get the nice optimal trade

answer you sell short patterns okay and

that's the one you want to be in and

then you see these sustained swings

lower begin

obviously like most everything I have

you know we're not gonna go through that

whole long-winded depiction of how

orders are stacked and how dealers work

within these key levels but assuming

that we had a support level and price

started up here much in the same

capacity salt on the selling side you

can see that unfold on the bullish

aspect of trading as well

you

you

you

you

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