All language subtitles for Lesson 7 - Market Maker Trap- Trendline Phantoms EN

Welcome back folks.

This is teaching number seven of
eight for the month of November,

2016 in the ICT mentorship.

We're going to be teaching trend
line Phantoms or false trend lines.

And the first is going to be
diagonal trendline support.

The priming is done by way of
seeing the market begin to make

higher highs and higher lows.

The market appears to have
an imaginary diagonal line.

It seems to repel price higher from
retail traders will extend these

imaginary lines into the future and
attribute, support theories to it.

When price hits the extended
imaginary diagonal line, connecting

higher lows, retail traders.

Buy it then conversely
diagonal trend line resistance.

This is primed in the thought
processes of retail traders by

seeing the market begin to make, huh?

The market beginning to make
lower highs and lower lows.

The market appears to have
an imaginary diagonal line.

It seems to propel price lower from
retail traders will extend these

imaginary lines into the future
and attribute resistance theory.

When price hits the extended imaginary
diagonal line, connecting lower highs,

retail traders short at that moment.

Okay.

Trend, line theory.

Now it's my prayer.

It's it's my perspective that there is no
basis on trend line theory in the form of

diagonal support or diagonal resistance.

And I believe it's his
basically an opinion.

Um, there's no statistical edge
that I've been able to build

with use of the idol support or
resistance in the form of trendlines.

Now I've been doing this for 24 years
coming up and just about the end of the

month, we're actually producing this video
in, I will have been a trader for 2040.

And in 24 years, I've done
a lot of things in analysis.

And I was indoctrinated with
trend lines when I first started.

And to me it made perfect sense because I
could see it in the past and all the books

give us perfect examples where all works.

But when we try to use the
trend line idea, which loads

do you draw connections to?

Which highs do you draw connections to?

And quickly, all of a sudden I
knew it's like, well, maybe this

isn't as easy as I thought it was.

But does price have an awareness
of the point of trendline support

or does price have an awareness of
the point of trendline resistance

I'll submit to you that it does not.

Price has no awareness
of your trend line price.

Doesn't respect what
you have on your charts.

Price only respects where the
actual liquidity is in the

marketplace and because they can't
see you because you're too slow.

The marketplace sees where the
large pools of liquidity are.

That means in buying interest,
in selling interest, that's

already in the marketplace.

In the form of protective cell
stops, protective buy stops, or

new buy stocks for long entries or
new sell stops for selling entries.

That's the only thing that makes price
move, and it's going to be hinged

and framed on the context of who.

Is in play right now.

What, what smart money entity has the
control of the marketplace at the moment?

Is it going higher based on their
book being bullish or is it going

lower based on their book being.

And that's what this mentorship teaches.

It gives you those ideas to go into seeing
where price is most likely going to go.

And we don't subscribe to down
sloping trend lines, or up sloping

trend lines to formulate ideas in
which we find support or resistance.

Based on that, an idea.

Do banks associate value or
prognostication on the basis of

trendline theory I'll submit to you?

No, they do not.

Now for some that are in the
financial industry, maybe.

Working at a bank.

Maybe you have used them in the
past and you've had success.

I'm telling you the banks don't have
any association or prognostication

placed on valuing a trend line
level on a diagonal basis.

And the reason why is because it's
so subjective, you are associating

future price, movement to a level
that hasn't been traded to yet.

You're doing it on the
basis of connecting to.

Reference points in the past that don't
have any bearing on what the future

price is going to do, has nothing
that high that you connected to,

to a lower high when you're looking
for resistance or, or downtrending a

trendline resistance that third time
it supposedly comes up to that line.

What makes you so confident that
it's going to go down at that point?

Just because you drew the
line on, on your chart, the.

Banks don't care.

What you're scribbling,
all of your charts.

They don't care about that.

They're not aware of it.

Okay.

But what they are aware of is sentiment
that shifts and builds around those

levels because it's going to be many
times being replicated on the fund level.

Funds will get beat up.

That's the basis of
trading large traders are.

That's where the markets go.

They go for their orders,
not for our little orders,

not for our little liquidity.

Okay.

But because we learned to trade and
heard like the fund traders, we are

many, many times our casualties of that
war between smart money and large funds.

That's the business model that goes on.

Large funds are cannibalized at
reversals, but they're permitted.

To facilitate long-term trends when
the markets are in that environment.

But trend lines are not the
key to it is the very nature of

trendlines flawed at its core.

I will submit to you that.

Yes, it is because it gives too many
dangling carrots in front of the

trader's eyes thinking that, okay,
this is going to be an easy setup.

So therefore, let me go in here
and sell it this resistance

trendline, or let me buy it.

This diagnose support.

It's not that easy folks, but many
times our charts will paint these

beautifully disguised opportunities
that are impossibilities.

Knowing this, how can market
makers capitalize on this

fallacy and price action.

Retail bullish trend lines.

In periods when price is making
higher lows and higher highs,

the use of trendline support will
be adopted by retail traders.

The influx of weak handed or less
informed money at an area or price level

provides liquidity for the market maker.

The chart may appear bullish, but the
underpinnings are in fact, the opposite.

The retail crowd will buy at a moment
when price will be devoid of supply.

Price will collapse and lead the retail
trader long withdrawal down in the trade.

When that third touch of that
uptrend line is seen in price action.

Many times I get dialed in expecting
the high that forms between the.

At the second time it hits the trend line.

And the third time it hits the
trend line that high in between.

I aim in that high for a bear shorter
block, or I will be allowing price to

just briefly poke his head above that
high for a turtle suit, especially if

the hard timeframe charts that I use
for my analysis indicate that we are

not enabling environment, but the lower
timeframes will many times paint these

beautifully illustrated uptrend diagonal.

So, what I'm trying to do is I'm
focusing in on when the market maker

sets their traps for sell scenario.

Many times that tie in between the load
at forms at the second retouch of that

trend line and the third touch of that
trend line, the high in between there

is going to be a cell scenario that I'm
aiming for in that I'm looking for a

bear shorter block, or I'm looking for
maybe sometimes on a lower timeframe.

I'm looking for a breaker, a bear.

Where the market has shown a willingness
to rally up to take on an old high it's

on a lower timeframe that may not be seen
as clear with that high in between point

number two point number three, all I'm
looking for as a reason to be contrarian,

because if the trend line looks so
obvious to me, I look at that as a trap

retail bears trend line reasons.

In periods when prices making
lower lows and lower highs, the

use of trendline resistance will
be adopted by retail traders.

The influx of we candid or less
informed money at an area or price level

provides liquidity for the market maker.

The chart may appear bearish, but the
underpinnings are in fact, the opposite.

The retail crowd will sell
at a moment when the price

will be devoid of resistance.

Price will rally and lead the retail
trader of short withdrawal down in the

trade between the high formed at point
number two and point number three,

the low in between those two points.

I'm going to be aiming for a reason
to be a buyer down there because I S I

will submit to you that if the higher
timeframes are indicating to the higher

prices, most likely going to be in the
near term and we're trading at higher

timeframe support levels based on or
blocks or institutional order flow.

I'm looking for that low between
high two and high three, I'm looking

for a bullshitter block at that
low in between the two points.

And while price may drop down into that
or low, just by a little bit, but not

getting down to the low altogether, I
will be looking for a bullshitter Bach

to buy, or I will accept a break just
below that low for a turtle soup long

entry, or basically a run on the cells.

Many times the market will break through.

Now a point at which I want to draw
a attention to is the second point

at which you have that trend line.

In other words, at the first high you
see, then it comes down and makes it a

lower high number two and it trades lower.

And you think it's going back
up to make a, uh, a number three

point high that's lower or three
times touching on it down the tree.

When the market rallies, I'm
actually going to be looking for

a move up into that second high,
because that's where a lot of the

buy stops are going to be residing.

The same thing said just an opposite.

When we're looking for that sell scenario
in bullish trend line support, retail's

going to be looking for it to go higher.

I'm looking for it to go
down below point number two.

That's where everyone stopped losses.

Now, when you think about like
this trend lines in the form

of diagonal basis, support and
resistance, it's really a toss up.

Do you have confidence that the trend
line that you're drawing is going to

really provide support or resistance?

Think about it.

It's really associated closely
to flipping a coin heads.

You're going to be a buyer and guess what?

Tales you'd be a seller.

You're back to the same equation of.

And we do not trade with
the perspective of chance.

When we trade, we look at the marketplace
to provide clues clues in which the

smart money is going to be utilizing
the liquidity that's made available for

willing or unwilling liquidity in the
form of the funds and uninformed money.

You have to think like that liquidity.

Prices delivered to engineer efficiency
for the smart money entities only.

Okay.

Folks, let's take a look at examples here.

Okay.

I want you to take a look
at this high right here.

Okay.

Price has a nice run away from that.

Say that very nice enemy in term high,
but an impulse price swing moving lower.

And we have.

A gap in here.

Fair value gap from the low of this candle
to the high of this candle, there's only

been down movement with this candles body.

I'm going to highlight this whole
area in here and we're going to

reference to the low of that candle.

Great.

Okay.

So we're going to watch
price as it trades.

That's just a reactionary level that we're
going to be waiting for in the future.

So this is how we stock a seller price
starts to rally up trades right into

that 52 34 level right there that
day it occurs is December 11th, 2015.

Okay.

Are we on the right hand side?

We have the 15 minute timeframe
for December 11th, 2015.

And we're going to
delineate that same high

at 52 34.

You can see price hitting it right here.

And I want you to look at how this
lo connected to this location.

Projected out events.

He hasn't done a third time hitting it.

Okay.

So trend line followers.

Let's see that as a potential continuation
co hire finding some support here.

1, 2, 3, maybe a run up higher
problem is, is we have a daily

institutional reference point over here.

And we're in that area over
here in this whole shaded area.

We've closed that.

So we will be looking for the next
area of liquidity in down here.

So we can look at this range

from this down candles high

from this damn candles, high
up to this down candles.

Between this candle's high and
this candle's low, it's only

been one pass on the upside.

So we're going to be looking for price.

And when to come back down into this
candles high in the form of 50, 60.

Okay.

So 1 50, 60 level.

So we know that a
possibility to see price.

I want to drop lower based on the quiz.

We have trend lines in here that would be
reasonable in terms of what retail will

be drawing, expecting some bullish prices.

Let me show it to you what it may look
like at the time when it was forming.

Okay.

You have a low here.

They're financing support
here, old high back here.

So they could reasonably
expect to see this to trade.

Higher problem is, is the
only thing that's done.

It's moved back up into the last
up candle here, which is a bear,

a shorter block right there.

So using the market efficiency paradigm,

we don't see this as trendline support.

We see this as a return up
into a reason to get short more

in the market breaks, lower.

Market trades down into a low right here,
which we'll look at when you zoom out a

couple minutes, but we have a low here.

We have another low here
projecting that low out in time.

Okay.

We can see price coming
down to that third time.

Does it make a bowl scenario?

No, it's only going up to
the last up candles midway

point or meet mean threshold.

So let's take a look at what that is.

Okay, right in here, equilibrium trading
rate debt for reference a reference point.

We're gonna be looking for price to
come down and close in this void.

This candle low here,
and this candle's high.

So in here has a liquidity void and we
have sell stocks below this low here.

Again, remembering that we're focusing
on the idea on the daily chart, like

a bank would looking for one 50, $60.

So up here, we're looking
at this market move higher.

Anything that would be viewed as support
on diagonal basis on a trend line.

We're going to look at that as suspect
and buyers are going to come in here and a

big influx, we're going to have wonderful
opportunities to be sellers to them.

Market trades, up into equilibrium.

One more time.

Pierce is a high turtles.

Sells off and it trades rent.

One more time down into
this level one here.

So I'm going to zoom out a little
bit to a 30 minute chart and you

can see that other trend line to
have a low here extend out in time.

Here's another low in price
comes down, hits it here.

Is that a by no, it's only coming
back up into this last upcoming.

Bear shorter block cell here.

Do not see this as a bullish
scenario because of trend lines,

because we're expecting this
area here to promote selling.

Okay.

It's in an area in which we're going to be
looking for a sell-off price does in fact

sell off and you see the bear Snus here.

It runs back above old
high turtle soup or bears.

Okay.

It doesn't, we're using a hard
timeframe set up over here.

Your stop would provide you an opportunity
to put a stop above an old high back here.

Price accelerates goes through
what would be considered trendline

support and ultimately down into
the 1 50, 60 level right here.

And as you can see it over here,

So let's take a look at some
downtrending or bearish trendlines

that are actually by scenarios.

Okay.

Folks, we have a nice run-up here.

Two down candles, right?

Free up move.

Okay.

So we have 1 43 85 or thereabouts.

The opening price on is 1 43 84.

So we'll round it to 43 85.

Okay.

And we have a down candle hits 43 85.

So we're going to add 43 85
to our lower timeframe chart.

So 43 85, we see price.

Trading down into it here, hitting it.

One more time.

We have a high, we have a lower high
and the third time price hits it here.

We see this as a sell.

No we don't.

We see it as a potential turtle
soup long here, or a return

back to bullish shorter blocks.

So we could be a buyer at
43 85 or 43 90 on a limit.

Or if we can get a fill at 43 80.

Or lower.

It can be a buyer down there with
the expectation that this is a

false trend line and we would
be looking for this high here.

That's the second one.

So anyone would be short.

All their protected by stocks
will be above this high in here.

Price rallies away

comes up real close to this high in here.

One more retracement level.

Back down into the last two down candles
here as a buying opportunity, again,

up here is where we'd be expecting
to see the buyer starts to be tagged.

You could see that happening here.

Five stops it right now.

I can see that happening here
by stops hitting right here.

Then you'd be permitted to see lower
prices because we've seen the highs taken

out here for the form of a buy stop read.

And then now that liquidity below
here would be allowed to be tested.

Can you see that happening?

Here's another example.

We have a nice down candle here.

Bullshitter block.

It's validated when the scandal
trades above this down candles

high, the very next can we trade
up again in the third case?

You see it opens here and trades down
into the body of this down candle.

The main threshold is
approximately 1 44 big figure.

And the open comes in at 1
44 46 on this down candle.

So we have 46 pit range in here.

And the day on this candle
is the 18th of May of 2016.

We see the 18th of May here.

Okay.

And we see the heart.

A lower high can extend that out in time.

Does price sell off here the
little bit, but then it comes

up pops through one more time.

So traders that even see this as a
downtrend, it may be, have been broken.

They may see this as a return
back down into it to be a buyer

and they're wrong there as well.

Also, you may see a classic chart
pattern here that we haven't spoke

about, but we're going to talk
about it in this mentorship as well.

Classic chart pattern triangle.

And false breakout here.

They would have been wrong.

Even trading with that and exploding
up into one, the 1 46 big figure.

Now, the reason why 1 46 big figures,
it's the last up candle on a daily chart

and it closed in all these down candles.

So institutional order flow,
you're going to see price

come up and close all that in.

So it's only been
delivered on the downside.

All down candles price has
to be efficiently balanced

by offering on the buy-side.

After it's been sold off and
been offered on the cells.

Price to be efficiently delivered,
has to be offered on the buy-side.

So we see that rally back up into that 1
46 big figure, and that's why it quickly

ran up into that level here, but breaking
this idea of the supposedly trendline.

That's not the key to it guys, but
we can see when the trades are seeing

these retail fingerprints all over it
probabilities really shift in our favor

when we're doing the opposite of it.

And we can also justify it with
institutional order flow and

institutional reference points on
a daily chart, just like a banquet.

So hopefully you enjoyed this teaching,
go back through all your charts, look

at some of the moves it's taken place
and go down to the lower timeframes.

And you actually see how these
trend lines are really there

as Phantoms and retail chases.

And then when they think.

They're really not there.

And they ended up giving up
the ghost and their profits.