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Okay folks.
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Welcome back.
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This is teaching number five
of eight for the ICT mentorship
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content for December, 2016.
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Deal with specifically the
reinforcing of liquidity voids and
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when to anticipate ranges to fill.
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Okay.
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I, liquidity void is a range in price
and delivery where one side of the
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market liquidity is shown in wide or
long one-sided ranges or candles price.
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Typically we'll want to revisit
this porous range or void
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of contrary and liquidity.
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Can we, we're going to look at an example
of a liquidity void and when prices
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in a small consolidation or a trading
range, we call this price in balance.
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In other words, prices in point of
equilibrium, at some point price war,
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eventually move out of the consolidation.
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When this occurs, we know that there's
our participation in the form of smart.
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Smart money is the only one that has the
deep enough pockets to cause price, to
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move out of consolidations or move at
all, really in any significant manner.
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This causes a price imbalance,
or as we call it, displacement
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price can stay away from that
drop down aggressively, where
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there was only two or three cases.
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That moved away from that
consolidation, that rain.
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I can stay open for a while.
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There's no specific time limit
on how long it's going to take
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for these voids to close in.
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And that's one of the re
repeating questions I get a lot.
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Is there a way to know how long it's going
to take for these w uh, to fill in with
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avoid would be in terms of how fast and
when can we reasonably expect it to fill?
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Uh, that's all going to be.
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Uh, germane to what you're seeing in the
market at the time you see the voids,
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uh, they can stay open for months.
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I can say open just for a brief session
intraday and it can close it in.
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It's all going to be relative to what you
see in price action around that before.
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Now, when I say void, what
am I specifically looking at?
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And we're referring to it's this small
little area of price action, where it
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was only delivered on the downside.
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We have, we have long bodied
candles where price has only
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been delivered on the downside.
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And it has a small little gap in
between the two biggest downcast.
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This is what we've framed
as he liquidity void.
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Now this is a one-minute chart because
at one minute charts got, and give
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me the opportunity to show you how
there are pockets in these big runs.
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And not that this is a big run in
terms of how many pips it moved,
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but it's a big move away from that
consolidation in relative terms.
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So the shaded area that consolidation
price moves aggressively away from that.
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When we see this, this is indicating
that they're smart money in the
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marketplace, and they believe that
prices wanting to go lower now
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because there's smart money there.
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Their orders are going
to be larger than ours.
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And that means their participation
is going to have to be scaled in
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that can't facilitate their entire
net short position all at one price.
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So they had to gradually
work that position.
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Yeah.
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It may require them to take
a little bit lower entry.
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Sometimes they may be to push it higher
and run back above that consolidation.
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And you take it in the form of
running out by stops and they
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can sell to those by stops.
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But that's not the point of this teaching.
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We're going to specifically
deal with the liquidity.
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When we have that liquidity void
and it's broken down like this,
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what is it basically saying?
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There's a void of buy-side liquidity.
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That means the market's
aggressively moved away from that
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consolidation that shaded in.
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And because it repriced aggressively
lower, it was all on self side.
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Liquidity only very little buying
took place in that rundown.
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So.
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The nature of a liquidity void is that
we'll probably see with a great deal.
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Probability of move back
up into that 1 0 4 76.
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Which would cap or fill in the entire
liquidity void that we see in the form
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of those two big candles that dropped
down away from that consolidation.
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But remember, it's a void of
buy-side liquidity that causes
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downward ranges like this, which
is what we call a liquidity void.
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In other words, we expect price to come
back up and trade right back over there.
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Same price levels that we see here
between 1 0 4 76 and 1 0 4 50 there.
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Okay, let's take a closer look here
with a five minute chart, that same
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consolidation you see this time.
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It's only showing as one big five minute
candle that drops down aggressively.
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That same area is
denoting, a liquidity void.
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And again, it's the absence of.
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Or buy-side liquidity and they're
running lower, aggressively repricing.
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So prices jumping down into that
1 0 4 42, 1 0 4 30 range before
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they start seeing buyers again,
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but pay attention to
these loads down here.
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We're gonna take a look at something
while price is showing a short-term
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support level like this, what's
going to be building up below those.
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Sell stops.
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So if we anticipate price potentially
going up and closing in that range,
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that we've identified here as a
liquidity void, what we're seeing there
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is a big single five minute candle
that's bearish sometime in the future.
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We expect to see that entire range
of that down candle, that big, long,
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thin candle that we've identified
here is a liquidity void that will be
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covered back over at some future time.
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In other words with that range with
bullish price action, no more to there's
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going to be a bullish candle or bullish
price swing that covers that entire range.
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That's identified here with the liquidity
void when it does that price action
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has been balanced out and I've worked.
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It's been a complete and uniform
delivery of price action.
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It's been offered on the down move
and it's been offered on the move.
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You see here, the cell stops below
those loads get ran and price runs up.
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And at this point here, you would
reasonably expect to see that
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liquidity boy completely closed in.
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Sometimes it does.
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And then sometimes it doesn't sometimes
it'll come right back down, run an area
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of liquidity, again, that same equal
lows, and then it runs up and hits it.
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And that last portion noted here.
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You can see where that
fills in the liquidity.
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Closing right up on that 1 0 4 76 level,
looking at this price action here, you can
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see there's several trades that you've,
could've taken even on both sides of the
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marketplace, but the ultimate draw on
price was to get up to that 100, 4 76
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level closing and that liquidity void
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note again, the stops that
were ran below that low here.
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Great.
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Before the void was closed.
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That low with these buying opportunity.
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And also you can see right before that
load is being shown here with the arrow.
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There was a short term low that price
dropped down below to hit that same one
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oh four ten two one oh four oh five level.
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Uh, the, uh, the biceps that
would be below 1 0 4 10 on that
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initial short term, low weight
above that bold arrow, um, denuded.
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For the last low before drives up to
ended at 1 0 4 76 level that run on
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those cell stops, what was necessary
for them to facilitate new longs.
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So that way, if they're going to take
out the one to 4 76, they're going
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to make it worth their while they're
gonna pick up some buy orders around
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1 0 4 0 5, 1 to four big figure to
identify what data feed you're looking
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at, but on this here for the Forex LTD
platform for demonstrating, uh, the
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feed shows a 1 0 4 0 5, thereabouts.
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And then price growing next, a
runoff 75 pips up to a one to 4 76
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and closes in that liquidity void.
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Seeing again, just on a 15 minute
timeframe you see now that big one,
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single 15 minute candle drops lower,
but away from that consolidation,
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again, denoting that liquidity void.
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And you can see now a little bit.
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Friendly on the eye where the runs
on those 1 0 4, 10 and 1 0 4 0 8.
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Cell stops would have been on the
15th and on the 16th of December.
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But notice also here we have something
that's a little bit, um, interesting.
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I want to show you there's two times
that trades up into that 1 0 4 76
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level, but this time it trades a
little bit higher than the first time.
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The first time I hit it, it was
around, uh, 1500 December 16th.
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The second time I hit it
was on the 19th of December.
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When we see this second time run up
into that, it just pokes his head
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above the previous time it went above
1 0 4 76, but look at the two candles
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immediately after the run into 104 17.
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There's two down candles.
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One has a little bit longer WIC, and
then the next candle, it gaps down at
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the opening and creates a bearish candle.
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I want you to look at
something specifically in here.
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You see that little space
right there for the bodies.
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Don't close in.
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What is this?
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This is a gap.
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Okay.
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It's a price gap.
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So if price gaps in here, how
can we use this information?
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We see that the liquidity
void has been closed in.
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They made a run one more time in the 1
0 4 76 blowing out the level two times.
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Closing the void.
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And if we know that they gapped
down or made that liquidity void
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away from that consolidation around
that 1 0 4 80 institutional level,
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that's what it's moving away from.
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It trades back up into 1 0 4 75 or
thereabouts two times the trades there.
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We know that it's more likely to trade
lower because it's moved aggressively
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away from that 1 4 80 level.
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And it's tried a couple of
different times to get up.
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And remember pricing in on
an institutional level has
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to happen in graduated terms.
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In other words, it can't, it
can't be done on the first pass.
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It goes to a level, it
runs away from our level.
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Let's say it like that
first day runs away from 11.
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In this case, it moves lower from 100,
4 80 and then it works its way up.
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Gradually up into that 100, 4 75.
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Once and then sells off.
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Why did sell off here initially on the
16th of December, because they priced in
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some more selling, so they build more of a
natural position there, then price trades.
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One more time up in that
1 0 4 75 level 1, 4 76.
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On the 19th of December.
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And then we see price immediately,
two bears candles, but one
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gaps down a little bit.
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00:12:05,084 --> 00:12:08,714
What is it showing you there
again, an aggressive move that it
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00:12:08,714 --> 00:12:11,714
wants to go lower, but now it's
giving you a golden opportunity.
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This is where we're
going to talk about gaps.
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A little bit more liquidity voids are.
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Yeah.
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During price trading, where it extends
across the, uh, this distinct range.
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When we see a gap where price has
closed from one came on and gaps
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00:12:28,845 --> 00:12:31,694
into another opening of another
candle, and that separation between
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the two price don't have a closure.
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In other words, it doesn't have a range
closing that in it creates a common.
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00:12:40,395 --> 00:12:41,805
What can we do with this common gap?
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00:12:42,464 --> 00:12:45,645
Well, we have a inclination that
we're going to be moving lower.
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00:12:46,064 --> 00:12:49,214
So if we're going to be moving
lower and we see a gap here, we
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00:12:49,214 --> 00:12:52,935
can put an order in here, the cell
with a limit order at 1 0 4 70.
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00:12:54,015 --> 00:12:59,594
So in that price gap, we can be a seller
at that specific price level at 1 0 4 70.
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Look at the reaction there.
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00:13:03,015 --> 00:13:03,974
Once it closes in neck.
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00:13:04,800 --> 00:13:09,060
The only the body closes it in, it
wakes up into the body, but the bodies
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00:13:09,330 --> 00:13:13,560
of the up candle as it closes that
gap, that's all that's necessary.
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00:13:13,620 --> 00:13:18,540
Very, very little draw down and
immediately it trades lower and reprices,
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00:13:18,540 --> 00:13:22,200
it makes it run down below the equal
lows that's been formed on the 15th of
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00:13:22,200 --> 00:13:23,850
December and the 16th of the second.
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00:13:26,020 --> 00:13:29,050
Scene a little bit more information here
in this 15 minute timeframe you can see
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00:13:29,050 --> 00:13:31,510
once that 1 0 4 76 level had been hit.
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00:13:31,990 --> 00:13:36,790
The gap had been closed at a entry at
1 0 4 70 with the ideal use of a common
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00:13:36,790 --> 00:13:42,490
gap price makes it run for 1 0 4 0 4
cell stops where we can take a cover
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00:13:42,490 --> 00:13:44,740
on positions that are short there.
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00:13:44,740 --> 00:13:46,780
Cell stops are used to
pair up short covering.
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00:13:48,015 --> 00:13:52,455
And price makes one more like lower
making a run out on one of the 365.
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00:13:52,485 --> 00:13:57,795
So again, one more time, pairing up, sell
stop orders with BICE to cover on shorts.
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00:13:57,855 --> 00:14:00,225
Everything that I'm showing
you here is this the reverse
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00:14:00,465 --> 00:14:02,445
with when the market is both.
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00:14:03,675 --> 00:14:06,015
And I'm going to give you
examples in your PDF file.
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00:14:06,015 --> 00:14:09,735
So don't be, uh, feeling a little bit
lost here because there's a lot of
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00:14:09,735 --> 00:14:15,015
examples that I can give you on, uh,
gaps in liquidity voids and order blocks.
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00:14:15,435 --> 00:14:18,944
And you have a lot more information
coming to you in supplementary
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00:14:18,944 --> 00:14:22,454
teachings the last week of December,
because there's no trading on the
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00:14:22,454 --> 00:14:25,365
week of Christmas while we're doing
this mentorship, but I will be.
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00:14:25,965 --> 00:14:28,665
Daily teachings and it'll
fill up your PDF file.
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00:14:28,665 --> 00:14:32,775
So your PFL is going to be rich
with a lot of content that can't
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00:14:32,775 --> 00:14:34,395
be shown here for the sake of time.
19830
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