All language subtitles for Lesson 6.1 PD Arrays (J) EN

Welcome back folks.

This is less than 6.1.

Oh the January, 2017.

ICT mentorship, defining
high timeframe PD.

Okay.

When we look at a chart.

Regardless of what
timeframe we're looking at.

It, uh, there's two elements
that come to mind as a trader.

Obviously we think in terms of support
or resistance, or we think in terms

of a volume we're sold, we think
in terms of purchase patterns, uh,

secondary, but, uh, generally we think
of a price being valued too low or

too cheap or expensive or too high.

And the algorithm.

Has similar thought
processes built into it.

And we look at it in the form
of a premium and a discount

market for sake of discussion.

Just think of this red line at the
top as a resistance and a blue level

on the bottom being supportive.

As price starts to move away from a
level that would be viewed as too cheap

or support naturally our expectations
as traders, we expect to see price

move higher when it does this, we're
confirmed to see a response moving up

to a resistance point of some kind.

Now the problem is with retail trading
and with technical analysis as a

whole by itself, it doesn't help.

Because every one of us could come
to the conclusion that a specific

level above current price action
would be a resistance level.

Some of us will see it as a, an old
low day would be trading to some of

us would see in old high, some of us
would see something else that would

equate to a resistance level now to
remove all the ambiguity, you have

to have a mindset going into it.

This teaching is to teach you
the air arche on the tools that

I use for framing the trades.

Now these same arrays are the same
things that we've talked about since

the beginning of the mentorship,
but we're going to prevent you from

having them in a disorganized fashion.

In other words, there's an air
archi and how they are used

and how you look for them.

And price is price makes a retracement
lower from a support level.

How far does it usually retrace back
all of us, again, based on different

walks of technical analysis and
different disciplines, we'll all

have our different conclusions.

Some of us would use a Fibonacci.

Some of us would use some fashion
of support and resistance.

Some of us would use Elliott wave
and ratios and harmonic patterns,

all kinds of things would come up.

By way of discussion.

If we were in a round table meeting
where you're all sitting in the same

room together, we all have different
opinions about how far it would retrace.

Some of us wouldn't even, even to
expect expected to retracement.

Okay.

Some of us would not see this as
a retracement, but a beginning

of an all-out reversal to
trade below the old low that's.

The problem.

Every trader is plagued with when
they come into this business, who's.

Who has the means of knowing with
great deal of prognostication, what

is a support level and what is the
resistance level and therefore, what

will propel price away from current
market action, higher or lower?

Because the common adage is if I
knew where price was going next, I

would need to know anything else.

I would make money.

That's not true because you
would find some other way to lose

money over leveraging or, or.

Doing something different you
shouldn't be doing and you'll break

a roll and you'll get emotional or
psychological impact because of that.

And you'll end up blowing the.

So when we look at charts, we want to be
viewing price in terms of, are we in a

premium or are we in a discount market,
uh, earlier in the mentorship I taught

how you could do that, but we're gonna
talk a little bit more in terms of how

to frame that on hard timeframe charts
in the form of an air arche with the.

As price starts to retrace
and then moves higher.

It hits a level of resistance.

Now for the sake of discussion, we're
going to say, we collectively understand

what would deem a resistance level
to, to remove all the, uh, secondary,

uh, discussions that we could have.

If we were a front in front of one another
in the same setting, you know, a live

setting where we could literally shake
hands and talk, all of us would have

an opinion about what would constitute.

Resistance level, but we're going
to say that this level that's

noted as red, that is the commonly
agreed bond resistance level.

The reasonable expectation
would be to see price move away.

And the price does that.

Some of us would expect one more,
try to get to that level, maybe

to go through it or to fail.

That's how I trade.

That's how I expect to see price react.

Some of us would not even expect
that they would expect this one-time

punch up air and all the other, all.

This is the type of
setup I like to see here.

Another pass towards that old high either.

It's going to give me a run-through
or false break, or it's going

to give me a failure swing.

We talked about classifying
institutional price swings.

That's what we'd done
for that teaching here.

I want you to start thinking in
terms of premium and discount on

higher timeframe charts, because
the air arche on how you view this.

Is going to help you, whether
you're a day trader scalper position

trader short-term trader with the
expectation of lower prices, how

far we expect to see price go down?

Well, the first impulse leg, and
then retracement, then as a second

leg, higher hitting that resistance
level, that secondary impulse leg.

That's probably going to be a good reason.

Expectation for support level.

Now it could be a bullish order block.

It could be a, uh, an old short-term
high in there on a lower timeframe.

If this was a monthly chart, uh, at that
low, there may be a daily short-term

high that would create a, a support level
that can't be seen on a monthly chart.

So when we're looking at these higher
timeframe charts, just understand

that there's going to be levels that
exist inside of larger price swings.

You may not see, unless you go
down to the lower timeframe.

Now, when I say lower timeframe, I'm only
referring to the daily because a hard

time for me analysis is all we're focusing
on here, nothing below the daily chart.

So for assuming that this is a
monthly chart and we're looking at

price, the expectation is, is okay.

Well at that old low, we would expect to
see some lower timeframe support level.

And then again, it could be the
monthly bullish order block.

It could be a week.

Bullish shoulder block, or it
could be a daily short-term high.

You may not be able to see it
inside that, that little wall there.

But nonetheless, when we look at price
swings back and forth on a chart, whether

it be monthly, weekly, or daily and even
lower timeframes, you have to understand

that there's swings that exist and
support levels and resistance levels

that exist in the lower timeframes.

That may not be so apparent using these
hard timeframe charts that is not.

What you base the majority of your
trades on what you're really doing

is you're gonna be using the monthly
chart and the weekly chart to frame

the context of what that market
should be doing using these PDA rays.

So if we watch price and it
continues to trade higher here,

where, where would you reasonably
expect to see price trade to that?

Short-term little swing
low at the failure swing.

That's going to be what
the potential mitigation.

It means any orders that were used to
go long, but failed to make another pass

at that old high they're underwater now.

So they're going to look to mitigate
those losses and cover their long

positions and go short potentially,
or just get out of the trade.

But smart mind just doesn't cut losses.

They know what they're doing.

They scale in scale out in the hedge.

So this would be another
selling opportunity.

The market seeks liquidity below the
low and below the second impulse swing

prior to the run into resistance.

So it seeks liquidity
below the marketplace.

Once it takes that liquidity out, it
can drive all the way down to that

old support level, but generally it
doesn't, it will retrace again and

pick up more orders back at an old.

Where we'd see another opportunity to
sell off and take out to liquidity below

a short-term load that was just created.

And back down to a logical area of
support, the expectation would be what

the C price bounce price does this.

When price starts to retrace.

Again, some of us, if we were
all in the same room, we would

expect to see that price low, to
be violated in a new, low created.

Sometimes that'll happen.

Sometimes it won't.

This failure swinging here could
be used, set up another long

opportunity for price rallies in the
here's the million dollar question.

The understanding is how price
moves from one level to the.

But predominantly it's moving from a level
of discount to a level of premium from a

level of premium, to a level of discount
between the red line and the blue line.

They are extremes in the middle.

That's classified as equilibrium or.

Buying imbalance is seen.

Moon price gets above equilibrium
or up into that red level,

which would be resistance.

Selling imbalance would be when
price gets below equilibrium and

down into the blue line or what
would be just drived as discount.

So where would you expect
to see price go next?

That's what you're always faced with.

When you sit down in front of the charts.

This discussion, we're going to
use the common ICT tools as far as,

uh, set up parameters in the form
of the way they form on charts.

In other words, the order in
which they form and how they use

them based on wherever you're
at, in terms of the marketplace,

we're using this teaching.

As a foundation, that's going
to lead us into a better

understanding of this example.

We showed, we were discussing money
management for the January content.

So less than five, that example for
the dollar yen pair for a long-term

position trade, this idea will be
used as an example on framing PDA

rays on higher timeframe charts.

But before we get into that teaching
for six points, We have to do the

foundation to understand what we look
for and why we expect it to unfold.

Like we would

okay.

Again, using our thought process of
premium, which would be the red line and

discount, which will be the blue line.

When you look at charts, you
want to see where a price has

moved away from an old time.

And it's dropping down from
an area of premium and where

it's it's too, it's too high.

So the evaluation is going to
be reduced and dropped lower.

So repricing takes place and the market
goes down and the price goes lower as

a result of it until it gets to a point
where it's too much of a discount, then

there has to be a premium built into it.

The algorithm will do this moving
price back and forth, back and forth,

back and forth until again, something
of significant impact comes into the

marketplace and dries the market.

One second.

And it creates a strong imbalance.

Otherwise the market's just
going to gyrate back and forth,

looking for liquidity based on
premium and discount conditions.

We'll assume for a moment
right now in the market prices.

Okay.

And we can clearly see that the
market in recent times had a clear

discernible level of resistance and
a clear discernible level of support.

Now that can come in the form of bullish
and bearish shorter blocks, or it

could be just old highs and old lows,
and we'll just use all highs and lows.

As an example for this discussion,
your expectation is, is right now

prices at a level where it should.

By all standards move lower because it's
at a classic viewed resistance level.

We don't know how long that time
is going to be required before the

market does in fact, submit to our
expectation and see a lower price.

So that timeframe, okay.

That part is what you're always going
to have to submit to time is a murderer.

It's a killer for traders, unless, you
know, That some of these ideas are going

to paint out for a long, long time.

You're going to do a lot of things
psychologically and emotionally

that you wish you wouldn't have
done because you haven't submitted

to that time aspect of trading.

There's two elements in trading.

You have to submit to time and
price when they both agree with

one another and you have waited for
that agreement to come to fruition.

That's where profitability
and opportunities.

So we're looking at price and we
have no idea how long time is going

to be required of us to wait before
the displacement takes place.

But eventually our expectation is we'll
see lower prices down to a level of.

And that's what we're expecting or
forecasting as a future price in between

these two pref reference points again,
time and price is what's essential.

You have to submit to the level of
time, which no one knows how much time

is going to be required before your
setup pans out or goes to profitable.

Price is what you're studying.

You're submitting to time throughout the
process, but while you are in the trade

or expecting this to unfold, studying
it, you're submitting to the price.

You know what?

You're not trying to
force your will on price.

You're analyzing price to see what
it is that it's telling you in

terms of institutional order flow.

Is it justifying your expectation that it
wants to go down to that discount level

or some bullish or block to buy back off?

And cover a short position, or it could
be a whole load at once to run below that

future price could be a number of things,
but for now, we're just going to aim for

an old low between the market price today
and the future price that you anticipate

or forecast lower in the future.

There's going to be zero opportunity
for it to be a straight line.

In other words, you're not
seeing that diagonal line in

the way the market trades.

It just doesn't do that is always
some give and take that takes place.

So.

Uh, understanding where certain arrays
occur in that process will help you.

Number one, stay with the trade idea,
not be shaken out of it and have the

confidence to hold until the objective
is met or your stock gets taken in.

It's simply moving to
the next opportunity.

The opposite is seen when you're
looking for a bullish scenario,

everything's just reverse.

You expect that market price to
be in the future at a premium.

In other words, it's going to
be harder than it is today.

Again, you have no idea how long time
is going to be required to get to

your future price or forecasted price.

And you have to submit to that the measure
of time that is an unknown you can't

know for certainty, how many days or how
many hours or how many months it will be

before that price has actually arrived at.

But you also have to be studying price
and again, monitoring and studying

the, the PD arrays that occur in price
action that leads to supporting your

expectation on institutional order flow.

That would drive price up
into that premium level.

The understanding is that price will
move from a discount to a premium

because the discount can't stay discount.

Very long.

Price is going to be established
by whoever is selling it.

Who, who stands there.

A profit off of it.

Well, the central bank is going to be
in the business of adjusting price.

So if we know that they are in control
of price, ultimately by way of steering

sentiment in economies, through the
delivery of an interest rate long-term

to stimulate or to suppress an economy
for our country, we have to view

the market in terms of technicals
to align ourselves with these ideas.

So if we see a level of.

Our expectation is okay.

Where is the evidence that this
thing will go to a premium market?

Where's the premium market.

Where's the resistance at where's the
higher level that I would want to see

at trade two between the market price
you're at right now in that future.

Again, it never happens in a straight
line there's time that you have new

understanding of exactly how long
it's going to be, but there's also an

element of price that you have to study.

In other words, just because
you think it's going there, it

doesn't mean it's going there.

It could go halfway there
and fail and go lower.

Nonetheless, what we're going to do
is I'm going to outline now the arrays

and keep them in a specific order.

So that way, you know, wherever you're at
in terms of market price, what you would

expect to see or what you're looking for.

Okay now w what should I be
looking for in a roadblock?

Or should I be looking for a gap?

You w what should I look for right now?

That's what this teaching's going to do.

Okay.

For a monthly chart.

Okay.

What you're going to do is you're
going to look at the current

trading range that it's in.

Okay.

So we're gonna assume that you outlined
the marketplace in terms of old

highs and old lows on a monthly, and
that's the easiest way of doing it.

There's other ways you can do it, but for
now, we're just going to outline it in

the context at the most recent trading
range that the market has moved from

an old high to an old low, that would
be our premium and discount definition.

In between these two reference points,
halfway point, this is always going

to be referred to as equilibrium now,
equilibrium between where you think

price will go, because it's been there
before and where it's at right now,

relative to an old high and old low
that's the current trading range.

And I'll give you an example, what
that looks like when we go into lesson

6.2, but for now I want to lay the
foundations for what it is you look for.

The first thing above equilibrium
in the form of an array is

an old high and old low.

You want to be looking for
that above equilibrium.

The next thing that you'd be looking for,
and this is in the order of importance.

Okay.

Old, high, old loyal, then the
next thing you'd be looking for as

a rejection block rejection block
would be just above the candles.

Not the Wix.

So the actual high and low is the
wick, but then the next area of

importance is the rejection block.

That would you be just above the
candles, body and the bearish order

block, a fair value gap, liquidity void,
bearish breaker, and the mitigation.

Put another way.

If we were at equilibrium and we were
moving away from a premium level or

at resistance, in other words, price
already dropped down and we anticipate

price going lower down to a level of
support or monthly discount we would be

looking for above current market action.

Again, assuming that we're at
equilibrium right now, we would start

looking above current market action in
the past and left side of our chart.

Where's the nearest mitigation block.

There may not be.

Okay, check that off.

Where's the nearest barest breaker.

There may not be one of those either.

Okay.

Check that off.

But if there is one, then you
would reasonably expect to see

price trade up to that price point.

Then expect some selling to go lower
and once it moves below equilibrium,

then you would be all set to go to
the monthly discount or support.

But let's assume for a moment,
a mitigation block isn't there

and the breaker isn't there.

What would you look for next?

Okay.

Well, the next order of air
arche is liquidity void.

Is there a range that
needs to be closed then?

Again, that may not be so clear.

Check that off.

No problem.

The next thing is there a fair value
gap again, that might not exist?

Go to the next thing, bearish order block.

It's probably going to be there.

Chances are, it's very strong.

It's going to be there.

So what did this give you?

I gave you the hierarchy
and what you look for.

The mitigation block is going to
be first considered before you

get to the bear shorter block.

Cause the bears water blocks can
be really high up in the premium

mitigation block is going to be level.

Mitigation and breakers are
basically mitigation blocks, but

generally mitigation blocks can
occur lower than breakers, small

little bounces in bear markets.

Would it be a mitigation block?

Basically a bearish Spreaker will keep
your ability to get to a bearish order

block, which will be resting higher up
in the premium when an old highs taken

out that down candle right before the
second highs made, taking out an old time.

Or turtle soup.

In other words, that down candle, if
it's retreated to, that's going to

be a bearish breaker, that's going
to keep you from seeing most likely

high probability that it won't allow
you to get to a bear shorter block.

So whenever you see bearish
breakers just don't expect the

bearish order block to be hit.

Okay.

Cause it's going to most likely keep
price lower, cause that's going to be the

most dominant, um, array of all these.

There is a liquidity void that would
be viewed with there's no breaker, and

you can close in that range and it may
take you off into a fair value gap or

a bearish order block, but breakers
by themselves, even though they're

low end on this list, that's the first
thing you're going to encounter because

if you're at equilibrium and price
has already been moving away from the

resistance level, you're looking up now
for any potential areas to resell at.

First, when you look at, as the mitigation
block or bear Spreaker, and if there's

neither of those, you look for liquidity,
void the trade up into the closing that.

Warfare value gap to close in.

They may not be any of that.

Then you would expect to see the
bear shorter block to be traded to.

Then that would be your selling
opportunity because you're at a

premium and you go to a logical area
where institutional order flow would

kick in new orders would capitalize
and into selling into if there isn't

an obvious bearish order block.

Okay.

Um, and there's very little times
that's like that, but we will

talk about that when we get into
entry techniques and concepts.

But if there is a lack of bearish
order, block, a understanding and what

you're looking at currently in market
action, because there may be a lot of

wicks, something like that may occur.

Um, then you would look for a
rejection block, which will be

just above the body of the candles.

Do we expect that to be ran out and
then you'd be really high on the

premium there and then ultimately
a whole, whole entire run on the.

That would be, uh, an expectation
now I have here old high and all.

Well, what, w w why
would the low be there?

Well, if you're on a very low end
of a downtrend on a hard timeframe,

monthly chart, you may be rallying
up to a old low, and if it gets

to that old low, even though.

It's an old load in, in terms of price.

It's really high up in the premium.

If it's been rallying a
considerable amount of time

and price to get to that level.

So retreating to an old, low that's
resistance, classic understanding, but.

It may need to run on an old high as well.

So basically all you're doing is,
is you're you're, you're scaling the

grade of how much important you're
going to have on each one of these.

So again, in summary, I want you to
understand what I'm talking about here.

We're not just listing the things we've
talked about in previous teachings.

Okay.

I'm putting them in an order of
significance when you're at equilibrium

or if you're moving up from discount.

Okay.

Expectations are to look for
very first thing you look for

in list as prices going up.

The first thing you're looking to see
to encounter, is there any mitigation

block that I've got to consider?

Because that's the first objective.

It could be a selling
point, then it's a bear.

That could set the tone for
another leg lower or stop any

rallies on a bullish idea.

Then the next idea, if you're bullish
from a discount, or if you're expecting

a new selling opportunity, say you're
at the equilibrium price point, anything

below the premium, the expectations.

And when you're looking at the F in
price for areas where price may go

up to it's in this order from the
lowest up nobody's from mitigation

block, all the up to old high in.

That's the order you
would expect to see them.

Now, the order of importance, I know
it's the highest of the premium array is

the old high in old, low that's that's.

As high as you can get, then
you have rejection blocks.

Then you have bear shorter
block, fair, fair value gap.

And then liquidity, void, bear,
Spreaker and mitigation block.

You're going to be looking up.

And the first thing you're going
to encounter is the first thing

on the bottom of this list.

And then you start working
your way up that list.

The farther you go up in this list,
the more deeper you go into a premium

market, certain arrays in here will keep
you from seeing the next higher array.

In other words, the next.

Institutional order reference
point that's listed in here.

If you get to a breaker,
chances are, you're probably not

going to go higher than that.

You won't generally get up
into close to that void.

If there's a breaker below a liquidity
void that liquidity void may stay open,

basically that range may stay open.

So they kind of like it's in the
order of importance as a trader,

when you're below premium and looking
higher up for prices or expecting

prices to move higher, that mitigation
block, you know, that's the lowest.

Likely one you're gonna
expect to run into first.

It doesn't mean that there's one in
price action, but you start from that

expectation first and you look for it.

It's not there.

Okay.

What's the next thing
you've been looking for?

The bear Spreaker.

If it's not there.

Okay.

Then I'm okay to expect that
void the close in debt, but

there may not be a void.

It may have been a really systematic
and efficient way that it traded lower

and that won't be any void there.

So next thing is there, is there a
gap that would draw price up into it?

If there's no gap, then
you go right to the.

Okay.

But the main thing is if there's
a breaker, forget about closing in

the void and forget about getting
up to that gap because the breaker's

going to take precedence over
everything on this list when you're

below it, in terms of market price.

If we were anticipating move lower
into price into a discount or into

a support level, we would expect
the very next PD array to be a.

Mitigation block now, again,
that may not appear in price.

If there is no mitigation block,
you would expect to see the

next PD array in the form of.

A bullish breaker.

And again, this may not occur or
should be seen in price action, but

this is the order in which you would
expect to see as prices going lower.

Looking in the past to the left
side of your chart, you'll be

focusing on whether or not these
arrays appear in price action.

Their importance is again, is listed
from equilibrium, the expected

order of how they're going to be
in the price action in form of a.

The first one you would anticipate seeing
as a mitigation block bullishly then a

bullish breaker, then illiquidity void.

Now, if there is a bullish breaker,
now again, a bullish breaker is a up

candle between two swing lows and the
most recent swing low would be lower.

No much.

You're seeing a stop run in the
past and the high that swing hide

it, it forms between the two loads.

That up candle is going to
be your bullish breaker.

So when price comes down, then at the
Bush of candle, it'll find some support.

If you see that in price action, chances
are, if there's a liquidity void in

price, it won't go down to fill that in.

It can, if it overtakes the barrier,
but if it has a breaker anticipate

price, not going below the breaker
and leaving the void intact

again, assuming there is no break.

And there is no boy, but there is
a gap and they may be at liquidity

void, any gaps sometimes that can
occur too, but you would anticipate

price reaching down into a fair value
gap, which is this a common little

gap where pricing only been delivered
all months out of the marketplace.

And then the next array
would be the bullshitter.

And again, without the breaker, you
would expect the void to be filled

a gap, to be filled, trade down
into the bullshitter order block.

Then below the order block would be a
rejection block, which is just below

the most lowest candle and its body.

In other words, if it has wicks
long wicks below it, we're only

gonna be looking for a mood just
below the bodies of the candle.

And that would be rejection block.

And then ultimately the deepest
form of discount would be in the

form of an old, low or trading
down to it in a historic high.

And like we said, when we were talking
about the premium market, when prices

trade up to an OHI, it can also
trade up to a very old longterm low.

And that would both be in the
form of a resistance level.

So when we look at markets like this,
what it does is it gives us a frame.

You can see here, the
monthly premium arrays.

These are going to be focused for
primarily bearish premium array

trading, and always you're going to be
using these areas at which the frame

of trade or look for bullish targets
at these levels for monthly discount.

You're bullish, discounted rate.

These are your bullish discount arrays,
and you would be looking for these

four bearish targets or looking to
get long at any one of these based on

the current conditions in the market.

Now, the same thing as seeing Elsa
for the weekly chart, the weekly

chart, you're gonna be looking at
the same thing from equilibrium up.

The first thing you would expect to see
when you're expecting higher prices.

Are we going to run into a mitigation?

They are Spreaker.

If there's a bear Spreaker, you probably
not going to go higher than that.

But if there is no breaker, you
look for a void to close in.

Or if you're a value gap, if there
is no fair, fair value gap or avoid

price could just simply trade right
up into the bear shorter block.

And if there is an idea that suggests
that there's possibly not a strong

bearish order block there, we would
look for rejection block, which is

a move above the candles bodies.

If there's long wicks
that top, that market.

And then ultimately I run above the
old high or return to a historical low,

the same things we just outlined for
the monthly is seen for the weekly,

both premium and discount, the same
Iraqi and how you would expect to see

these arrays occur in price action.

This is the way they are seen.

And obviously the same thing is
said for a daily chart, nothing's

changed the same error exists.

If we're at equilibrium.

And that's the current market action
price and we're expecting lower prices.

The first thing we want to look for in
the left side of our chart, is there any

mitigation blocks or a bullish breaker?

If there is anything less than
that breaker probably won't be

considered or retreated to the breaker
has precedence over everything,

both bullish breaker and bear.

So Ronald, take a look at an example
of all this information with our dollar

yen example that we mentioned briefly
in lesson number five, money management

was hard time from analysis using
these ideas in 6.2, that lesson will

actually give it real practical example.