60. surprise livestream

Economic Calendar Insights and Trading Strategies

Introduction to Trading Mindset

• The speaker expresses hope that the audience had a good weekend and emphasizes the importance of not rushing into trades, highlighting that trading is about managing risks rather than winning every time.

• The focus is on being professional risk managers, aiming to win more trades than they lose, which sets a realistic expectation for traders.

Economic Calendar Overview

• The speaker shares their screen showing the economic calendar and encourages participation in a specific app for better updates and communication.

• Feedback from users is crucial as it helps improve the app's functionality; changes are made based on user input.

Market Volatility Analysis

• There were no significant news events impacting the market recently, leading to low volatility. This lack of movement is attributed to index futures reaching all-time highs.

• The speaker discusses how certain high-impact news events (like CPI or NFP) can influence market volatility and price movements.

Upcoming Events and Expectations

• Looking ahead to Tuesday, there are no expected high-impact news events before Wednesday’s CPI report, which is anticipated to create significant market volatility.

• The timing of sequential SMT (Smart Money Technique) formations before CPI can indicate potential price expansions; lower cycles before CPI suggest larger expansions.

Weekly Trading Patterns

• Wednesdays are highlighted as critical days for forming weekly highs or lows due to upcoming economic reports like CPI.

Understanding Weekly Price Ranges and High-Impact News Events

Weekly Price Dynamics

• The discussion begins with the concept of price returning to the weekly range, emphasizing that a week will typically have both a high and a low.

• Fridays often form the week's low, while highs can occur earlier in the week, such as on Wednesdays. This highlights the non-linear nature of price movements throughout the week.

Non-Farm Payroll (NFP) Insights

• Last week's market saw significant expansion, particularly within the US dollar, covering the entire weekly range and more.

• The focus shifts to analyzing current data related to NFP events, indicating that these are crucial for understanding market volatility.

Market Reactions to News Events

• The speaker discusses how major news events like NFP and CPI create volatility that traders are often advised to avoid due to unpredictability.

• A specific example is given where a wick formed rapidly after news release, illustrating high-frequency liquidity runs during impactful announcements.

Liquidity Runs and Timing

• It’s noted that liquidity runs can happen very quickly; for instance, a wick forming in just two seconds indicates extreme market activity.

• The importance of timing is emphasized—liquidity runs lasting longer than 15 seconds may indicate different market behavior compared to those occurring in mere seconds.

Data Analysis from Different Providers

• Comparison between data from different providers (capital.com vs. TVC) reveals discrepancies in accuracy based on raw data sources from futures markets.

• Observations about candle sizes and precision swing points suggest potential reversals in price movement across all markets—not limited to Forex alone.

Understanding Doubling Theory and Market Dynamics

Introduction to Doubling Theory

• Doubling theory extends the concept of quarterly theory, allowing for analysis over five days instead of just four. It aims to identify correlations that quarterly theory may overlook.

• The discussion includes how correlations can be observed between different weeks within a quarter, emphasizing the complexity of these relationships.

Data Analysis and Market Indicators

• Key market events such as Non-Farm Payroll (NFP), Consumer Price Index (CPI), and Federal Open Market Committee (FOMC) meetings often lead to significant price movements in financial markets.

• Observations are made regarding discrepancies in data from different providers, highlighting the importance of precision in trading decisions based on US Dollar Index data.

High-Frequency Trading Insights

• The speaker notes that high-frequency trading can create rapid price changes within seconds, which traders must recognize to make informed decisions.

• A specific example is given where a wick formed on one data provider's chart but not another's, illustrating the need for traders to monitor multiple sources closely.

Correlation Between Forex and Indices

• During periods of consolidation in Forex markets, there may be simultaneous expansion in index futures. This delayed trajectory can indicate future price movements.

• The relationship between various currency pairs like USD, EUR, and GBP during consolidation phases is explored, suggesting potential predictive patterns for traders.

Understanding Market Behavior

• Analyzing S&P 500 alongside Forex trends reveals that while one market consolidates, another may expand significantly. This divergence can signal upcoming volatility.

• Traders should pay attention when indices do not follow currency movements; this could indicate an impending large swing move in either asset class.

Conclusion: Navigating Complex Market Dynamics

• Recognizing when indices and Forex markets diverge helps traders anticipate significant moves. Understanding these dynamics simplifies decision-making processes.

Understanding Market Dynamics and Liquidity Pools

Experience in Trading

• The speaker emphasizes the importance of recognizing one's own trading experience, suggesting that individuals may underestimate their knowledge until they share it with others who are less informed.

Market Overview

• A chart is referenced showing major indices: S&P 500, NASDAQ, and Dow. The speaker highlights key liquidity pools to focus on for trading strategies.

• Buy-side and sell-side liquidity are discussed, indicating areas of market imbalance that traders should be aware of.

Price Action Analysis

• The speaker notes a high time frame sequential SMT (Smart Money Technique) between two assets, advising caution unless price breaks above certain highs.

• Current market conditions show weakness; the Dow is in discount while E-mini S&P and NASDAQ are in premium, indicating low probability trading conditions.

Sequential SMT Stages

• The first stage of sequential SMT has been established within the yearly cycle; however, the speaker prefers confirmation from monthly or weekly cycles before making trades.

• Ongoing geopolitical tensions are acknowledged as influencing current market behavior but deemed normal within historical context.

Liquidity Expectations

• The concept of buy-side and sell-side liquidity is reiterated; price movements above or below these levels should signal potential reversals.

• The speaker advises against impulsive buying without clear price action signals, contrasting current indecisiveness with previous clearer opportunities.

Future Sessions and Learning

• Anticipation for future discussions is expressed; the importance of understanding market movements is emphasized as foundational knowledge for traders.

• A reminder about an upcoming session scheduled for Wednesday at 6 PM EST aims to build upon concepts introduced in this discussion.

Key Takeaways for Traders

• Emphasis on patience and understanding why markets behave differently under various conditions.