VIDEO
HIGHLIGHT
Log InSign up
ICT Mentorship Core Content - Month 1 - Elements Of A Trade Setup
SummaryTranscriptChat

ICT Mentorship Core Content - Month 1 - Elements Of A Trade Setup

Introduction to ICT Monthly Mentorship

The first teaching tutorial from the ICT Monthly Mentorship for September 2016 introduces the elements of a trade setup, emphasizing the importance of context and framework in trading decisions.

Elements of a Trade Setup

  • Context and Framework:
  • Emphasizes the significance of context and framework in trade setups.
  • Discusses the two primary concerns: context or framework surrounding the idea and specific principles related to trade setups.
  • Market Conditions:
  • Explains four market conditions: expansion, retracements, reversal, and consolidation.
  • Each condition provides a specific framework for trading decisions based on market behavior.
  • Institutional Order Flow:
  • Introduces order blocks, fair value gaps, liquidity voids, liquidity pools, stop runs, and equilibrium as reference points in institutional order flow.
  • Understanding these characteristics enhances comprehension of market efficiency and smart money influence.

Interbank Price Delivery Algorithm

  • Algorithm Overview:
  • Describes the interbank price delivery algorithm as an artificial intelligence-based price engine for currency pricing.
  • Highlights the shift towards electronic algorithms in market making for increased efficiency.
  • Market Manipulation:
  • Discusses market manipulation in foreign exchange due to algorithmic trading.
  • Mentions identifying market fingerprints and clues for anticipatory skills development.

Market Dynamics: Consolidation to Expansion

Explores market dynamics from consolidation to expansion phases, emphasizing impulse moves and retracements within trading cycles.

Market Phases

  • Consolidation Phase:
  • Defines consolidation as a holding pattern before potential expansion.
  • Expansion Phase:
  • Highlights how markets transition from consolidation to expansion through impulse moves.
  • Retracement Patterns:

Understanding Market Conditions

In this section, the speaker discusses the four key conditions that interchange in the market and how traders can utilize this knowledge to make informed decisions.

Reversal Patterns and Market Conditions

  • Reversal patterns are followed by retracement, consolidation, and other conditions.
  • "These four conditions interchange throughout the ups and downs... you just need to know where it's at."

Importance of Understanding Market Direction

  • Understanding where the market is likely to go and where it came from is crucial for making trading decisions.
  • "Over the course of September... know where the market's going to go next."

Consolidation as a Starting Point

  • Markets start from a measure of consolidation as it signifies building orders by market makers.
  • "Consolidation begins with everything... defined range until there's enough money on both sides."

Expansion and Order Blocks

This section delves into expansion in price movements, its correlation with order blocks, and how traders can use this information effectively.

Understanding Expansion in Price Movements

  • Expansion occurs when price moves quickly from an equilibrium level.
  • "Expansion is when price moves quickly... delivered by one of these four conditions."

Significance of Order Blocks in Trading

  • Order blocks play a vital role when price leaves a level quickly, indicating market maker intentions.
  • "Expansion couples directly with the tool of an order block... looking for a bullish order block."

Utilizing Retracement for Trading

This part focuses on retracement as a key element in trading strategies, emphasizing its importance and practical application.

Leveraging Retracement Strategies

  • Retracement occurs when price moves back inside a recent price range, revealing market maker intentions.

Understanding Trading Concepts

In this section, the speaker discusses key trading concepts such as retracement, liquidity voids, reversals, and consolidation.

Retracement and Liquidity Voids

  • Retracement occurs when there is a sudden movement away from a price level, creating a liquidity void.
  • Traders should wait for opportunities to fill in the liquidity void rather than chasing prices.

Reversals and Liquidity Pools

  • Reversal happens when price moves opposite to its current direction, indicating market makers' actions.
  • Look for liquidity pools above old highs or below old lows to identify potential reversal points.

Characteristics of Trading Pairs

  • Some trading pairs exhibit choppy price action like the USD/CHF pair, making them suitable for specific trading strategies.
  • Strategies like turtle soups and false breaks can be effective in certain pairs like USD/CHF.

Consolidation and Equilibrium

This section delves into consolidation as related to equilibrium in trading setups.

Understanding Consolidation

  • Consolidation occurs when price moves within a clear trading range without significant upward or downward movements.
  • Market makers allow orders to accumulate on both sides during consolidation, hinting at an upcoming expansion.

Impulse Moves and Equilibrium Points

  • Watch for impulse moves swinging away from the equilibrium point located at the midpoint of the consolidation range.
  • By recognizing these characteristics, traders can develop a framework for studying price action and discovering consistent trade setups.
Playlists: 2016 ICT Private Mentorship Core Content Month 01
Video description

2016 Premium ICT Mentorship Core Content Video Lectures Audio and visuals are exactly as they were distributed in September 2016. CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN Trading performance displayed herein is hypothetical. Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance trading results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results. U.S. Government Required Disclaimer – Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with money you can’t afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results. Trade at your own risk. The information provided here is of the nature of a general comment only and neither purports nor intends to be, specific trading advice. It has been prepared without regard to any particular person’s investment objectives, financial situation and particular needs. Information should not be considered as an offer or enticement to buy, sell or trade. You should seek appropriate advice from your broker, or licensed investment advisor, before taking any action. Past performance does not guarantee future results. Simulated performance results contain inherent limitations. Unlike actual performance records the results may under or over compensate for such factors such as lack of liquidity. No representation is being made that any account will or is likely to achieve profits or losses to those shown. The risk of loss in trading can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. If you purchase or sell Equities, Futures, Currencies or Options you may sustain a total loss of the initial margin funds and any additional funds that you deposit with your broker to establish or maintain your position. If the market moves against your position, you may be called upon by your broker to deposit a substantial amount of additional margin funds, on short notice in order to maintain your position. If you do not provide the required funds within the prescribed time, your position may be liquidated at a loss, and you may be liable for any resulting deficit in your account. Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example, when the market makes a “limit move.” The placement of contingent orders by you, such as a “stop-loss” or “stop-limit” order, will not necessarily limit your losses to the intended amounts, since market conditions may make it impossible to execute such orders.