All language subtitles for Lesson 6 - Low Resistance Liquidity Runs In Trending Conditions

Welcome to the ICT mentorship, short
term trading lesson number six.

We're teaching low resistance
liquidity runs in trending conditions.

Okay.

Much, like we mentioned in
the low resistance liquidity

runs in consolidations.

The same thing applies obviously
in Trinity and conditions, because

we understand that the market
moves from a time and price theory.

We're looking back 20, 40, and
60 trading days for if the data

ranges and referencing time.

And for one shot, one kill or short
term trading, we focus primarily in

the last three months for the most
salient institutional reference points.

We key off of obviously the PDA rays
based on a premium or discount market.

And we're looking to trade from
one PD array to the next, ideally

from a discount to a premium
range that can be easily defined.

Okay.

For our case study for liquidity runs
and trending conditions, we're gonna

be looking at the pound again, and
this time we're gonna be looking at a.

Fractal of the larger consolidations.

So we're going to be looking at a
smaller segment of this price action and

because price is universally fractal,
uh, what could be a consolidation on one

timeframe can be a trending environment.

So we're going to add our PDRs
from the monthly, weekly, daily.

And we're going to use this information in
conjunction with the trending environment

conditions that we use to trade from a low
end discount to a high-end premium market.

In other words, we're going to be
looking at an example of buying during

a upswing or a trending bull market.

Our case study is going to be
focusing on this price line here

as identified in the shaded area.

And this is going to be
our trending condition.

Now, before we get into it, notice that
we are originating the basis of that

swing up from a deep discount market.

Overall, the larger and consolidation we
can see clearly that the market has found.

And because we're in a discount
market, the market generally is

going to want to move to a premium
either by a short term basis or enemy

a term basis or a long-term basis.

So since we're looking for short term
trades, we know that predominantly the

market in the March time period is in a
oversold condition in oversold condition.

Or defined as we refer to
it as a discount market.

So the market's going to want to
reach up into some measure of a

premium if there's a displacement and
the market trades higher we'll know

that because the market is showing
a aggressive nature to trade higher.

And if that is being shown in
price, then we know that instant.

Funneling money.

And they're also building
positions in the up move.

Now, obviously, if they are building
long positions in the market

is accelerating on the upside.

They're reaching for some institutional
reference point where they can

unload that long position at a
profitable point, they have to find

willing buyers at a higher level.

So we have to look for premium PD
res where willing participants in the

marketplace will want to buy from.

Lower holding long holder
or in this case smart money.

Okay.

For one shot, one kill.

Uh, we're going to be dealing
specifically with the four hour

chart and then the four hour chart
is in my opinion, the easiest trade.

Timeframe for one shot, one kill
setups, or how the frame that's set

up, uh, because it's my cup of tea.

If you will.

It's my forte, my, my go-to trading model.

Um, I have learned that the four-hour
chart can give us all the insights that's

necessary for using all the details
and components to finding one shot,

one kill or short-term trading with
high probability trading conditions.

So by using a four-hour chart, It's
easier to frame a one shot, one kill

or short-term trade in this timeframe,
because you can see with a simple couple

of clicks of your empty four platform.

If your platform doesn't use this,
whatever the equivalent would be.

Uh, but if you hold down control
and touch the letter, Y it'll

give you the date dividers.

Okay.

And specifically when you're in
four hour is not giving you a daily

dividers, it's actually giving you.

The weekly dividers.

So every vertical dotted line
here represents the beginning

and end of a new trading week.

When we look at price like this and
we have the PD, it rays on our chart.

It's very easy to see where price
will reach up to notice that we're

also looking at this payer with
the gradients shown across all of

the discount and premium ranges.

So we've not only had the
discount premium range.

Then we have the upper portion
divided and then we have those

smaller divisions in half as well.

So we can see how the market has
different levels of progressive premium

and progressive discount, light levels.

In other words, lower levels of
discount and higher levels of premium.

When we look at the four-hour chart
and we can see a PD array, for

instance, a discount PDR, right?

This could be in the form of a
bullish, shorter block and old

low, a fair value gap, a breaker,
any of these types of PD arrays.

If we're looking to go long,
if that occurs or forms near.

Divider level or a quadrant level as
I call it, you'll be able to see high

probability movement away from that level
and then reach for an opposing level.

For instance, if we look at the market
in March 15th, where price had come down

into the fair value gap, it also trades
back to a breaker scene here that moves.

Trading to that level gives us
an ideal scenario to get long.

We may have missed the entry at a lower
level, but we can see this return to

a breaker or fair value and market
explodes on the upside and trades higher.

You don't need the absolute low in a
Bush weekly close or up weekly rain.

To be a one shot, one kill, you just
need one set up that you wait for.

That makes logical sense.

That gives you a realistic PIP objective.

And I think realistically, uh, for
starters, you should be looking for 30 to

50 pips a week, those types of scenarios,
and then gradually into 50 to 75 and

then 75 to a hundred pips per week.

I wouldn't try to go
more than a hundred pips.

And I like to live in a 50 to 75
pit range, myself personally, but.

You do to suit yourself.

I just know that you're not always
going to get big weekly ranges.

Sometimes you'll get small, weekly
ranges, and it's going to be harder for

you to get that 100 foot range if it
only moves about 150 pips for the week.

So you're gonna have to really
define a perfect entry and

exit strategy to get that.

I'm not saying it can't be done folks,
but just give yourself some flexibility

on both ends getting in and getting out.

And so if you're looking for the
lions portion of the weekly range,

you know, taking a portion of that, Is
all that's necessary for your career.

So if you look at the four hour
chart, what we're doing is we're

encapsulating the weekly range
and you can see this is the entire

weekly range for this particular week
shaded in yellow, you can also see.

That the market reaches up into
logical areas of premium PD at res.

And we'll cover that in a few moments,
but look at this for a second and think

about the power three that I teach, where
if the market's bullish, the open will

be near the low of the range and the
close will be near the high of the range.

You can see that here, the market has
a initial move lower in the beginning

of the week makes the low of the week.

Explodes on the upside.

It gives a few, not many, a few
high probability entry points.

If you missed a very low
point, it's not a problem.

Look at the four hour chart with
all of the monthly, weekly, daily

PD PDRs, obviously on the four
hour to keep this chart clean, I

didn't add the four hour PD arrays.

You can add them and you'll have more
detail on this chart and you'll have

more insights to the trade off of.

To keep things germane.

And only on the higher timeframe,
we're just using the PD erase from

the monthly, weekly and daily levels.

And the subsequent week is seen here,
same scenario, the market trades

down initially making the low of the
week and look at the response off

of the divider between the total.

Macro consolidation that we did.

And we discussed in the beginning
of lesson number five for cable that

removing that movement down into
the midway point or equilibrium of

the overall consolidation that is.

High probability level in itself.

Now, if you don't understand how
to break a range down or grade

a range or a price swing, you're
going to miss these types of moves.

So you have to always look at the
trading ranges that the market's

trading in, look at the highest high
and the lowest low in the form of the

body's, not the Wix and define that.

And then once you have that, that's
your like your master blueprint.

If you will, then you start breaking
that down because the algorithm is

going to work within that range.

It's going to go back to
reference points based on time.

And price where price has already
traded, where it hasn't been

traded to in reference to time.

So we're looking for that same move that
originated in, uh, March 14th, uh, going

into the 15th, that low formed in cable.

That was in a discount market.

The second week that shaded in yellow
here sees us reaching up into a halfway

point of the upper portion of the total
range, or in other words, half of the

premium range that we defined by the daily
chart in its larger trading range, it

moves from one level of logical discount
to another level of logical premium.

It's very discernible.

You can clearly see it just by
disgracing over this chart real quickly.

You're not going to get the benefit
of looking at price like this.

If you, if you don't study it basically
and see the reactions to how price is

moving and grab, gravitating towards
how I've broken down the range, they

act like, um, magnets, if you will.

Uh, there's a component to trading
that people like to put on a truck.

And I used to.

I used to trade with it as well.

I used to trade with it as well.

They were called pivot points and while
they still are called pivot points, to be

honest, but, uh, they came from the floor
traders and pit traders where they would

do calculations based on the high and the
low and, and adding specific measurements

to get the projected highs and lows,
and suppose it support resistance.

Now that was like a self
fulfilling prophecy.

But when you look at the grades of
a trading range or a price point,

It helps you really discern where
the market has, its highest probable

support or resistance without really
having a logical old reference point.

Like when we do support resistance,
we'd look for an old level.

We draw it out in time and just
because it did something back then we

expected to do it again in the future.

And you've seen how that's
worked out in your own trading.

It doesn't have any consistent.

So you have to look at what the
institutions are doing and look

behind the scenes and what's
the institutional order flow.

So if we can grade a price swing from
a premium or discount measure, we

can see the market was clearly in a
discount range in the 14th of March.

So by trading down there, trading
into the fair value you got the

shaded in green, the natural response
would be, see price, trade higher.

It does that.

And then it starts finding new
levels of support institutionally.

Based on a discount PD, RA no words.

We're looking for
reasons to support price.

It could be in a form of a bullish
shorter block, fair value gap,

a breaker, a mitigation block.

It could be a old, low, or
an old high once broken down,

turning support, all those ideas.

Okay.

Lend well to supporting
price going, hiring you.

You start working towards.

A premium market intro week.

The more we get closer to a, another
level of premium based on defining

your range and declining your price
swing and grading it, you know, what's

breaking it down into quadrants and in
splitting in half when the market reaches

for these measures, okay, it's almost
like a mile marker for the algorithm.

It will reach for it and then
give the participants at the bank

opportunities to facilitate trade.

Breaks through a level.

Okay.

And it trades right through it.

You know, that it's going to most likely
reach for the next level up a very rarely.

Do you see any midway points,
uh, between the grades that

I've already given you here?

No, it's the way we define the
market, breaking it down and

cutting the ranges in half.

The way we did that in less than five,
that's the same levels we're seeing here.

So I didn't add anything new except for
the shading of the yellow and the box.

I'm just giving you the context
behind the market and why it

was doing what it was doing now.

Clearly, obviously one would say,
okay, well, this is obvious, you know,

armchair, quarterbacking, it's hindsight.

But if you go through the charts, it's the
same thing happening almost all the time.

So by having the theory behind
why it's doing what it's doing,

we can look for how each week.

This same component or element to one
shot, one kill will repeat itself,

looking closely, looking closer.

We can see that each week that the
market we trade is going to seek the

trade from one PDF array to another.

It we'll trade from one quadrant to
another with the least resistance.

It can move from premium to discount or
discount to premium market valuation.

Now it's the determination of whether
it's going to move higher or lower

is based on where we're trading it.

At the time, when you're sitting out in
front of the charts, if we're in a premium

market, it means we're really pushed up.

We're into a logical area of where price
has shown a willingness to sell off before

it's away from its lowest levels of.

Historical buys or where old loads
have formed, basically how we framed

premium and discount what we've
already taught in this mentorship.

But when we have the levels on
our chart and it's in a four

hour basis, it gives us context.

It tells us how we can anticipate
the four weekly range because

these daily, or in this case on
a four hours, a weekly delighter

by hitting control and tapping Y.

You get these vertical lines on empty
for what you'll end up doing is each

week before the market starts trading
on a Sunday, what you want to do is

just load up your four hour chart,
have your PDA rays loaded on there and

make notations of where you think price
may logically reach up to when it's

in a discount market or where it may
reach down to when it's in a premium

market by looking at where the PD res.

In a four-hour chart, it's almost like
you can anticipate what the weekly range

will do in a completed sense in order
to what the market looks like after

the week closes on Friday and in a good
example, or a exercise in this case

would be to do this every single week.

Try to anticipate.

What the weekly range will look like now,
you're not going to get this all the time.

It's not going to be perfect.

And many times you're not going to be
close to it at all, but what it will do

is it will help build your anticipatory
price skills, which is necessary to start

seeing this stuff before it happens.

We're trading in probabilities.

We're looking at a statistical edge
that the market, if it's in a premium,

it's most likely going to want to
trade lower, where does it trade down?

It's not just looking for a support level.

It's looking for an old area
of institutional order flow.

Where was their old buying?

Where was their old institutional
order flow seeing in the marketplace.

And it's going to be in
the form of a PD array.

So we look at our PDA matrix,
determine what are those PDRs that

exist in your chart at the time?

And you look at how reasonable it is
for it to reach down into, or up into

that level between the two verticals.

You only have Monday through Friday?

Well, Sunday's opening until Friday.

So you have an element of time
that you have to work within.

So, because it's relatively
short-term in nature.

Uh, it's easy to predict where the market
may go between a Monday and a Friday.

And you don't have to have
the highest high and you don't

have to have the lowest low.

You just need to know what's
the probable direction.

And what levels will it
most likely key off of?

That's the benefit of using a four
hour chart and using the PDA rates

from the monthly, weekly, and daily.

For hour, if you want to have all
that on here, but nonetheless, if you

key off a daily, weekly, and monthly
PD PDRs, I want a four hour chart.

You're gonna get the highest
probable trade reactions.

And that's what the institution step in.

Now, when you refine it down to a lower
timeframe, obviously in an hourly chart,

you get more detailed and you get more
opportunities to reduce the risk and

you might get another opportunity if you
miss the overall, uh, daily or weekly.

PDA Ray.

And then what if you missed that entry?

It may give you one more shot to get on
it with a hourly chart, but it's better

if you just train yourself to work off of
a four hour chart and start to envision

and kind of more or less predict what
the weekly range going to look like.

Here's an example here where the market
trades down into the fair value gap.

We're in a deep discount.

Mark.

And for that week, it trades
up into a bearish order block.

The subsequent week, we have the price
trading down into the equilibrium price

point of the total macro range from the
daily chart that we showed in lesson five.

And it also trades back down
into an old bullish order

block from the previous week.

And then the market trades
up and closes in a Fairview.

Seen back in February

now taking this information and
refine it even further down into

a 60 minute chart, you'll start to
see a little bit more definition

in the market and looking closely.

You'll see that there are many times
you'll see breakers and mitigation blocks

that didn't exist on your four hour chart.

So.

Anything less than a one hour chart.

When you look for one shot, one kill
really reduces the effectiveness because

what you're looking for is that impulse
price swing to help facilitate the weekly

range or complete the weekly range.

Anything less than a 60 minute chart,
you're really just day trading or your.

So that's why you want to focus
primarily on a four-hour chart for

the levels you want to key off of.

But once you get down into an
hourly chart and then you can

break the market down into a day
by day basis, and then we can start

incorporating day of week phenomenon.

So if we're looking for a bullish market,
moving from a discount market to a

premium each week, What we're looking
essentially for is the low of the week,

the form between Monday, Tuesday, and
Wednesday, they are the highest probable

trading days in this environment.

So the criteria is in a training
environment, we expect bar price to

trade from a discount to a premium.

In this case, we would reverse everything
if we were expecting lower prices from

a premium down to a discount market,
but we have our PDA rays on our chart

and our levels and our quadrants on.

So we have all of our natural
support resistance, which is

the grading of all of them.

The levels that we did in lesson five
and then incorporating the actual PD

arrays and deference to the, if the
data range in the last 60, 20, and 40

days, the low of the week in bullish
conditions and trending environments,

we look for the Monday, Tuesday, or
Wednesday load a form in the first

week we see here Monday, Tuesday, and
Wednesday, the low forms on Tuesday.

Notice the low forms off of
illogical PDRs in a discount fashion.

Trades down to a fair value gap
that's seen on the daily chart.

So price trades up creates a high that's
slightly higher than Mondays high on

Wednesday, and then breaks through it
and creates a higher high for the week.

So the intro week high
is formed on Wednesday.

Notice on Thursday, it trades
down into the fair value

gap into a mitigation block.

Also from Wednesdays intraday
trading in the market.

Does what another impulse print price.

All the way into Thursday,
there's in the consolidation.

And then Friday, it has a small little
Judas swing trades down into equilibrium,

and then expands on the upside, going
into the close the second week or

subsequent week in our case study, uh,
we see the low forms on Monday after

it hits the equilibrium price point
of the overall macro consolidation.

As we defined in lesson number five.

And then Tuesday, we have a retrade
back down into that same old low.

So we had another retouch of
the equilibrium price point and

then acceleration on the upside.

And then Wednesday, we have
another opportunity to get long

trading off of a breaker that's
formed on that week's Monday.

So we have Wednesdays trading
trading down into a breaker bear.

Shh.

Uh, Uh, bullish breaker formed
on Mondays high Wednesdays low is

formed off of that trades higher.

And then notice also a while
we had slightly bullishness on

Thursday and in a relatively flat,
uh, close on that week's Friday.

One of the things I want you to see is
when we go through this process, you're

going to quickly learn that typically
the weekly ranges, they have a 30 to 50%

of the weekly range completed between
Monday to Wednesday and always by

London, close on Wednesday 30 to 50%.

Generally the range is completed.

So what is that?

If we have the willingness to,
to look for longs only, we expect

the market from a discount to a
premium, to unfold for the week.

If we do not capture the long either
Monday, Tuesday, or Wednesday, and it

has happened to potentially form, and
we've seen some price sessions that

suggested that weekly range is going
to be close or bullish as we expect

it, but we didn't get the trade on.

Uh, maybe we were stopped out.

Maybe we missed it all together
or maybe we were wrong.

And we found out later in the week
that, oh yeah, this is probably

what's going to happen now because
that's going to happen as well.

Uh, you may expect something
to unfold, uh, for the week

and then it doesn't do that.

And you have to be
flexible and change gears.

And we're going to talk about that
in lesson number seven, but if you've

missed the Monday through Wednesday
phenomenon and the market's already

traded, just know that it's important.

Not.

PIP drunk, trying to get a lions portion
of a move by Friday's close because the

weekly range may end up being smaller or
less volatile than you've anticipated.

So just know that generally a
third or half of the weekly range

is done by Wednesdays London.

And don't expect a massive
move higher or lower.

And in the last two days of the
trading week, generally, if you get an

explosive move, usually on Tuesday or
Wednesday, Thursday may see a little bit

of follow-up follow through, but then
Friday has either retracement or does

what you see here in the second week
where it's basically a neutral close.

It doesn't really do anything
more stunning than what was seen

in Thursday or Wednesday street.

So we're going to build on the
idea of this and incorporate

how to know when there's going
to be an entire week reversal.

So until next lesson, I wish
you good luck and good trading.