All language subtitles for Lesson 2 - Institutional Order Flow - What Makes It Easy To Know EN

Okay folks.

Welcome back.

This is lesson 2nd of November or the
third month of the ICT mentorship.

Okay.

Want to talk about.

Institutional order flow and
what makes it easy to see?

And we're going to be building a
little bit on what we just mentioned

in the previous lesson, and we're using
that Euro dollar example and here's

that order block we showed earlier,

we showed in the lesson.

You see, the open comes in at 1
50, 1 97 and the low comes in at

51 45 and the low I'm sorry, the
high comes in at 51 51 and 51 43.

So very sensitive there.

The idea is if we see this
on a monthly chart, okay.

We can go into the marketplace
and anticipate an ideal scenario

to unfold in this area here.

Okay.

Now let's drag it out for that
low cause it ain't that big.

Okay.

So we have that low to the opening price.

As we mentioned in lesson
one, we discussed it there.

A high probability of stops
resting below these lows down here.

But I want you to focus on is, look
at, look how the bodies of the candles

basically merge at that same general area.

I want you to ignore the wicks.

Okay.

Ignore those.

And by having that in mind,

All below these lows in here,
there's going to be a large pocket of

liquidity in the form of cell stops.

Now, if we're looking at the monthly
chart like this, and we think

that there's going to be a high
level of sensitivity up here, why?

Because it's already come up
and close in this range by

coming up to this level here.

And if the market is most likely going to
trade lower and seek the liquidity below

these lows here now, again for your notes.

When we're looking at institutional
order flow, the idea is thinking

like that market efficiency paradigm.

Okay.

You're the market maker.

So what you're looking for is where
is the maximum level of liquidity in

relationship to where markets have
traded from and where they are presently

while the market has traded higher?

So where's the highest level of
liquidity from this point here.

If it's going to go higher, it
would be above here, but we had

this void that we'd closed in.

So the market's now rebalanced through
a point at which they sold first, it

moved quickly away, came back up and
closed in that range that created

by all these down black candles.

So in other words, the market
has delivered price going.

It has to close in that gap
by trading it on the upside.

So we're forever, wherever
there is a black candle there,

it must be a green candle.

The idea is you want to see
where the market will reach for,

for its next level liquidity.

We had the rundown here clearing out
these stops market clears, those stops.

And then once it clears,
those stops right below.

No, it's all this movement over
here, all this running off stops.

Yes.

It moves back to a order block,
but we're not talking about that.

Now.

I want to talk about how the
market will seek liquidity.

The market will run up from this
point here because it's already

absorbed all the liquidity down here.

And yes, just for completeness sake,
it's returned back to a bullish

order block over here, which is
the down calibrate for the up move.

So the market is going to do what it's
going to seek a liquidity on the upside.

So where does that reside?

This up candle.

That's where they sold the last time.

And look, we created another
liquidity void all these down candles.

Okay.

All black candles down.

Okay.

So there has to be the market offering
on the buy side, they offered it on the

sell side to balance it, and it has to be
green candles or up candles in this case.

Okay.

All my down candles are black
and all my up candles are green.

So we had that same challenge.

Just repeating itself here or here.

Okay.

Now obviously we always look at the
middle of the upper candle means

threshold, and you can see how the
bodies of the candle respect that

there's always going to be this extra
little outrun on price with the Wix.

Okay.

I've mentioned this in many, many
instances over the last six and a

half years, teaching Forex online
that you're going to have to allow

that, um, erroneous price action
where it re run farther than right.

Uh, you probably would expect
it to because of your broker.

Okay.

So they allow them to open the
spread up a little bit more.

So when price trades up, it hits this
area of liquidity now where we're going

to be expectancy, price, trade to,
well, the largest area liquidity would

be resting below these lows, right.

Or this law rather look closely
just like we showed over here

with the buyers of the case.

Okay.

We're gonna look at the
bodies of the candles here.

Okay.

So classic technical analysis where we'll
say, well, this, this WIC is the low.

And what I teach is it's the bodies
of the candle is where all of the

volume is the institutional volume.

As a difference.

Now, the WIC is always going to
be directly related to reading.

Okay.

Retail stops because we're
looking at a retail platform.

Most instances you're going to see
the wick is generally comprised

of retail pricing, the bulk of
the bodies, close to the interbank

price as you're going to get.

So we allow the Wix to provide
us a erroneous price delivery

or extreme price delivery.

But we want to do most of our analysis
around the bodies of the candles.

So what does that mean?

It means that if we have the bodies of the
candle is defined here as the real low and

allowing all this to be viewed as retail.

If we scrubbed the over tier, you can
see how price trades just below the

bodies of the candle, as it would in
terms of seeking the truest form of law.

From an institutional,
uh, order flow standpoint.

If we're not going to break the
range on this run here and we'll

teach about that in the mentorship,
but for now we expect it to close

in the range here just as well.

We saw this up candle here,
this down movement price comes

up and closes in its range.

Then it runs for the liquidity below here.

The point of what I'm showing here is
once you understand where the market

will most likely reach for, and this
is a monthly chart, now we can take a

step back and say, okay, if I can define
the market in terms of, and we'll say,

for instance, say, say we were lucky.

Okay.

We were really plugged in.

We were studying and we felt that
this market was topping out up here.

Okay.

And we knew.

That once this low was violated here,
we would have a potential range of that.

Clearing out.

This consolidation staff
will be resting below that.

Okay.

We would see reasonably
expected to run through that.

We also know that we have a
bullish order block right here.

Now notice it wicks through that, but the
body of the candle, this body's candle.

Sorry, this candle is potty rather.

Trades right into this candle here.

Okay.

So that's all that's required
to trade into bullet or block.

It's a monthly chart now, so we can expect
some expansion through and the Rhonda

liquidity out here, look at all the wicks.

Okay.

The wicks are no significant barrier
in terms of institutional order flow.

We just know that there's going to be
a large reason to expect stock resting

below the Wix we're inside the Wix.

Let's say it that way, but
below the bodies of the.

Okay.

So what we're seeing is we're
seeing another area at which

we have price trading from
the buys of the candle.

We dragged out over here.

Let me see price trades into
that area right in here as well.

So it's seeking the liquidity below
all these bodies of the candle and

the Wix and recapitalizing this.

You see the bodies of the candle looking
out and respecting that all the bodies

stay above this candles abortionist.

Now we would reasonably expect
to see price trading down

to that level at that point.

We see this willingness to want to be
recapitalized in this bull shorter block.

And we clear up the stops.

The next area would be what to see price
reach up into the void, which is up here.

So we would see price wants to reach
up and capitalize this price level.

So we have an area at which
institutional order flow is bearish.

Till we get down to here,
then where's it going to do?

It's going to look for
liquidity on the upside.

This is the area which you would expect
to see price that wants to run up into.

So as prices rallying up, it's
this all bullet show institutional

order flow is bullish here.

Then once it gets to this point
here, we're looking for what

the stops below these lows here.

So we would see institutional order
flow, swing to the downside, and

that is what's happening again.

The bodies of the cans.

It's violated, but this down candle
here, we clear out the stops.

Okay.

And again, we've mentioned that
it's retracing back into this

bullshitter block from here.

Where would we reasonably
expect price to go up to again,

that's this bare shoulder block.

So you want to see price reach up to here.

So in this instance, we would expect to
see what price rally up into this area.

So all through here,
Institutional overflow is bullish.

Now I can keep doing this back
and forth, back and forth and

show you example after example.

But what I'm showing you is from
a monthly standpoint, you take the

information I'm showing you here.

And by example, and again,
here's the bodies of the candle,

not the Wix, it stabs through.

To go below the bodies of the,
like, it doesn't necessarily

have to go through the Wix.

We only need it to reach
below the buys at a candle.

Okay.

So while we have institutional and flow,
that's bearish when it's in the red area.

Okay.

All we're going to do is internalize
the marketplace like this.

So if we have it set up like this on
a monthly chart, all we have to do

is break the market down into a week.

Does changing into a weekly chart.

Okay.

So now we have the price
shown in weekly basis.

All all through here, we have the
marketing and selling condition markets

in a bullish market condition verus
market condition, bullish market

condition, bearish market condition.

Okay.

So now what we've done is
we've mapped out this entire.

Euro dollar from mid 2008, all the way
to mid 2012, just by understanding what

the monthly levels on institutional order
flow will give us and understand those

points of reference that I showed you in.

What to focus on because that's,
that's the recipe for all the trading

you're ever going to want to do.

That's it that's the secrets.

Okay.

But you have to find them on the higher
timeframe and arrive at where the high

timeframe charts you're going to seek
liquidity, because this is where the

large funds had their money and where the
large money is found on the fund level.

That's where the banks
are going to reprice too.

It's not for the retail people
because you're too small.

If we're selling or expecting
bearishness in here.

Okay.

This decline sees a retracement
back up into, and yes, it wicks

through and wicks through.

But the body of this candle is where
you'd be looking to be a seller, but

this wick never violates this up candle.

So we have a bear's shorter block
retreated to and expands lower prices.

Creates a down candle here, right
before this up move in in a time where

expected institutional overflow should
be seeing price move up into that.

They are shorter block,

great areas where you expect to see
buying in an area at which bullish

prices should be expected until it gets
to this level here, which is at monthly

bear, shorter Blockly shown on a monthly
chart, then price would be reasonably

expected to go lower to seek the stops.

But yeah.

These candles down here, the
bodies of these candles, and

that's what you see here.

But look how the Martin look out in the
market provides us an opportunity of

real crystal clear, uh, delivery, a price
where we see price repel breaks down.

Okay.

When does it become apparent?

That is going to go lower.

See this candle here, here, here, here.

This last up candle.

That's the last green one.

When that candle is a
violator right there.

Right here on this black one.

Now you're going to be expecting
price to expand on the downside price.

Does it here trades a little bit lower.

Then we have a small
little retracement higher.

What's the trading back up into this
down candle, which is a breaker.

What's it breaking the highs here
where the initial sellers would

be having their buy-side resting.

And then we clear those
out and we go lower.

But this down candle is where they're
going to populate new selling.

Right there.

And you could see them
selling it right here.

There's other mitigating the longs.

They use to buy the price higher.

They make, they take those orders off and
then you see the acceleration going lower.

All this area in here.

Okay.

We have an up candle down, move
retracement back up into what,

what is this bare shoulder block?

So what this bear order block.

okay.

Bare shoulder block right in here.

It trades up into it and
immediately sells off again.

What's institutional order flow,
reaching for the stops below.

But why is this signal forming here?

Why is this pattern forming?

Because it's undoing the buys.

It was used here or the down
candle is a bullshitter block

and they should be buying there.

And it does look at this boom explodes.

This cell is unwinding.

The lungs they put here, everything
is a hedge on in their bank.

Okay.

When you've seen price move from one
level to the next, there's all buying

and selling, going back and forth in
between those two range extremes range

extreme down here, range extremes up here.

Then there's another range extreme here.

Another range extreme here
and Lorraine extreme here.

Okay.

So in between these two extremes,
there's going to be hedging.

There's going to be bookmaking where the,
the bank could have a net bearish book

here and be making money as it's going
lower, but they have to be buying too.

And while they still may see price
going here and selling, they have

to take the orders off that they use
over here that are long and attitude.

That's why you're seeing
the unwinding right here.

Everything is going to be the
opposite side, go over to the left

side of the chart and you'll see
whatever they did to go along.

They're going to take
that off on the sell side.

Okay.

Which is the basis of a macro macro
cell profile, which is what this is.

That's consolidate.

Return the consolidation accumulation
or accumulation smart money reversal,

low risk short and redistribution.

Now other redistribution and
the market reaches below the

consolidation of your taking out.

Those stops.

Once the stops are cleared out,
they're going to look for another

layer layer of institutional
order flow for the opposite side.

Okay.

So that's going to be in the form of.

The return back to this bear shorter
block, which was shown on the

monthly chart, the market trades up
into that level here, but between

the point at which it hits here.

And once it creates the run on the
stops over here, we would be any bullish

institutional order flow environment.

So we would expect to see the market trade
back into down candles to be rebought.

No one's new buying should be seen there
this down candle rate for the up move.

You could see the price.

Two candles whipped down into this
candle right here from the high

down in the middle of the candle.

It wicks into it here, and this
is kind of hard to see, but that

candles low comes in at 2151.

So 2151 is a low, this candle is low.

So it's down here and you can see that's
what I'm highlighting right there.

The low it's inside this down candle.

So it's buying, explain the
expand price out higher, then

you'll have a retracement, okay.

Price.

Retraces.

Traits into what this up candle.

So what's this, they sold here last up
candle is they sold why they sell there

the dry price below these lows in here.

So there's your, uh, your run on stops.

So the up candle they used right
here to get sellers the low the

marketplace with their sell stock.

Why would they want the sellers?

Because they're sales not to become
marketers, to be buyer counterparty

to, so where does the sell stop loans?

They will activate them and buy them smart
money will buy that once price trades

through that, it'll come back down and
trade right back into the last candle.

Why are they doing that?

Because the shorts that they have on, they
have to take those off and mitigate them.

So this wick down to the
body is a mitigation block.

So price comes down and
hits that level here.

The shorts that they use when the
price was going up, remember smart

money sells as it goes higher and
he drove it lower to run the stops

price traits through that category.

But their orders are under
water now as it's up here.

So when price comes back down trades
in that same range, from the high down

to the body of the candle, they can
take those shorts off and buy them.

And then you're going to see
X explosive price action.

Why?

Because it's going to be buying a
cover on shorts that are here and then

buying more for new net long position,
and you'll see expansion aggressively.

And you see that here.

So now you have down candle
right before the other.

In a time when institutional order
flow suggest prices should be bullish

while we're in that shaded area,
price trades down into the bowl.

Shorter block, new
buying should take place.

Expand up.

Now, when we seen buying down here
or would expect buying in here, the

reason my expectation would be the
C price trade up to this up candle.

First.

That's your first objective
then above this high for style.

And then expansion up into closing in
this range here into this bear sh order

block, which is his last up candle comes
back down by ball, shorter block, expected

to run through here and back up into the
mayor, uh, monthly bear, shorter block.

And it does that handsomely here, suites
it out, and then we can see what price

breakdown again, having those gummy bears.

Cause it breaks the last up candle at an
area where we would expect to see bears.

Breaks it here it comes right
back up at the bottom of this

up candle retreads to it.

You can be expecting
downside movement in price.

Price starts to break lower.

One more time.

Read trades back up into
this bear shoulder block for

good measure breaks down.

Now it's going up.

It's going to go lower
trades up one more time.

Works that same bear shorter block here.

Finally gives up the ghost and
trades back up into this high here

price rate trades, lower reaches
for the liquidity below here.

Below the bodies of the candles over
here, over here by reaching down

and then ultimately reaches below
these lows and back down into the

bowl, shorter block, right over here,
which is what we're seeing here.

So if you start with your monthly and
you break down into the weekly chart,

we can go down to a daily chart.

Now let me see a lot more
definition on the daily chart.

Bullish candle, which is the bare
toter block because the price drove

lower retreats rate back into the
bear shorter block right here, bodies

respecting the middle of that up.

Candle sell off market creates bullish,
shorter block rallies through clear

and short-term highs retrace back down
to the last down candle bull shorter

block rally down candle propulsion.

Rallies up small little drop down
hits the exact high that candle here.

High comes in at 28 0 2.

The low in this candle comes in
at 27 95 into this body's candle.

I'm sorry, this candle spotty
rallies all the way up into bears.

Now again, we're in a blue shaded area.

So while on a daily chart, it's dropping
lower, lower, lower, lower, lower, lower,

lower the institutional order flow.

And the monthly is telling
you to get ready for a buy.

So we get down into these levels in
here, expect to see some buying, but

we have to wait for price to want to
show a break above a short-term high.

We see that short-term high violated here.

So now we know buyers in market.

Again, wait for the comeback down into.

That monthly bull shorter block.

We see it traded in here, but
now look what happens this

down candle here, rallies away.

It comes right back down into it
now on a daily to the daily here.

It's that, but shorter block.

And then look at the re look at
the reaction expands quickly.

Now we have this down candle.

Draw that out in time by here, by
here, rallies up this down candle

key falling institutional or.

The highest 34 36, the low is 34,
23, right into this down candle.

Again, buy it again.

Boom explodes keeps going
higher and higher, higher

and goes into consolidation.

Every new buying finds a down candle.

You go right back to the
previous down candle.

Buy it again, rice price rallies,
again, price dips back down

into what does down candle here.

Buy it again, down candles in here.

All one order block, halfway
point through that right there.

Boom.

Buy it again.

Rallies through, keep in mind of
the monthly and weekly order blocks.

We're seeing it again in here.

You see the response?

Boom.

It rallies.

That's why you don't see anything right.

Notice there's no bullish
order blocking here.

There's no, uh, any, any kind
of point of what you would see?

Oh, this is what that would be.

No, it's found on the weekly and monthly.

That's why you see this response here.

Price rallies away.

It comes back down trades into bearish
candle, which is the bull sorter block.

And then something really did it traded
right into, uh, the low 46, 26 into

this order block right here and rallies.

Again, you can see the shaded
area we had again from the.

Rallies again, explodes up into
monthly bear, shorter block.

Last up candle right here.

This one, when it violates that,
does it here expect to see bears.

Miss wait for it.

Boom.

It breaks.

So when price breaks down, you're going
to be waiting for a return back to a,

either a breaker or a bear shorter block,
or you can look for a stop run on an old.

So we're in an area where we expect the
seed markets continuously moving lower.

Okay.

On the daily chart, we can be using
all these old lows to see price,

reach for them or expand down.

So institutional flow is suggesting
lower prices, especially for

the monthly and the weekly.

Now we're in a daily chart timeframe
when the institu or flow should

be weak or bearish, when the
market creates a return back into.

A monthly order block here.

It becomes a mitigation block on
a daily chart because now we're

unwinding what we used to be
bought here, which is a breaker.

Was it breaking this old high that's
we're already seeing it right here.

You can clearly see it happening
here on a daily chart, but it was

seen on a monthly and on a weekly,

all through here, all through
here in this red area.

Every single time the market creates
a new VR shorter block, or if it

creates a run above old highs, we see
the old highs here runs through them.

Sell off old highs in here, runs above it,
sell off old high here runs above it, sell

off, and we also have bear shorter blocks.

Last up candle rate for
down move sells off.

Last that came over before the downloads.

Retreats back to it sells off last up
candle, even in a sloppy mess, right?

To the body of the candle right there.

Boom.

Now we're in a bullish area on
institutional order flow and you would

expect to see all these levels, which were
being found on the monthly and the weekly.

Look at the sensitivity
that you see on the daily.

Now we have the last
down candle here, right?

For the up move price trades into it here.

And it's on a hard timeframe.

Down candle here as well.

Buy it again, buy it again.

Price explodes.

Look at the sensitivity right there.

Again, this level was arrived there
on the monthly and weekly and look at

the responsiveness you've seen price.

And was it reaching for liquidity above
the old high, in a bear shorter block?

So, what you're doing is, is
what institutional order flow is.

It's the seeking of large institutional
liquidity, and it's going to be found

on the monthly and the weekly, and you
see that being traded into on the daily.

That's why I tell you on the daily chart.

And again, this is why
we're looking at a daily.

Uh, the daily chart will always seek
the fund level institutional order flow.

In other words, the stops that
are found on monthly and weekly.

You're going to see all your signals
to have the greatest magnitude.

The biggest moves to take place are
always going to be found on that

monthly and weekly basis, because
that's where all the large whales are.

Okay.

When I say whales, I'm talking
about big funds, large funds.

Okay.

And when they have money, That's where
the market's going to go, because that's

orders that they can counter party with.

The banks cannot counter party with you.

And I, we just not big enough, even
collectively we're not big enough, but

the funds because they're controlling
billions and billions of dollars and

there that's where the money's at.

So if you can find the levels on
a monthly and weekly chart, keep

them on your own, your daily chart.

You'll be able to see all
these major shifts in price.

That sometimes jump off at you
after the fact that you wish you

would've known they were coming.

Um, now you know how to see them by
transposing them from the monthly,

the weekly, into your daily chart.

If you do your trading around
these levels, you will see every

significant price swing that
they ever transpires on price.

You'll see them coming before they.

And you'll also know relative to
institutional or flow where the stops

or liquidity is above the marketplace.

When you're here and you buy it, or
when you expect a bullish scenario

unfold, you'll already know where
the market should be reaching for it.

Should it take off and start trading
higher when it goes up to a level of

resistance or some kind of bearishness
before you even sell short, you're

going to know where it's going to be
reaching for, which is a sell stocks

below the recent lows or a bullshitter.

And by having an idea of how the market
will continuously look and seek liquidity.

It's not our liquidity,
it's not our stops.

It's looking for, it's looking
for the stops, found on a monthly

and the weekly and daily, because
that's where the whales reside.

That's where the large funds reside.

And that's what pushes price around
understanding that that's why the market

will go to these levels because it's
wanting to take those participants either

out of the marketplace or draw them in
as counterparties to their intended.

Either being a buyer counterparty
to sell stops or to be a seller

counterparty to buy stops.

And that's the nature of
institutional order flow.

So with that guys that wish
good luck and good trading.