2025 Lecture Series - ICT Venom Model Tutorial \ 04/03/2025

NASDAQ Futures Review and Venom Model Overview

Introduction to the NASDAQ Futures Review

• The session begins with an overview of the April 3rd, 2025 review on NASDAQ futures, focusing on the one-minute chart for June delivery.

• A significant gap is noted between the previous regular trading hour settlement price and the opening price at 9:30 AM Eastern Time.

Opening Range Gap Trading Strategy

• The speaker discusses using the opening range gap strategy during the first 30 minutes of trading (9:30 to 10:00 AM), emphasizing a 70% likelihood of retracement in extreme gaps.

• Given a substantial drop of nearly 1100 points in NASDAQ, it is suggested that a rally back may be unlikely due to external factors like tariffs.

Market Sentiment and Analysis

• Reference is made to a tweet regarding discrepancies between NASDAQ highs and ES (E-mini S&P), indicating bearish sentiment.

• The discussion shifts to analyzing electronic trading hours from the previous evening, highlighting key levels such as upper/lower quadrants and consequent encouragement levels.

Understanding Electronic Trading Hours

• The speaker explains how market behavior respects certain levels established during electronic trading hours leading up to regular trading at 9:30 AM.

• A candlestick pattern at the opening price is analyzed, illustrating its significance in understanding market movements.

Introducing the Venom Model

• An introduction to the Venom model is provided, aimed primarily at those familiar with prior teachings; new learners may find it disjointed initially.

• Emphasis is placed on understanding liquidity draws post-opening bell and predicting subsequent market actions based on these insights.

Riddles of Market Predictions

• The speaker addresses common skepticism about accurately predicting market movements, suggesting that many traders claim certainty without evidence.

• Personal experiences are shared regarding live trades showcasing significant profits while cautioning against misrepresentation by others claiming similar trades without proof.

Execution and Student Guidance

• Students are encouraged not to falsely claim participation in trades unless they have verifiable evidence; this promotes integrity within their learning community.

• The importance of pre-market analysis before opening is highlighted as crucial for successful trading strategies.

Framing Narrative Logic with Venom Model

• Key levels for potential trades are identified ahead of time through Telegram communications, reinforcing strategic planning before market opens.

Trading Strategies and Market Dynamics

Understanding Pre-Market Trading Hours

• The speaker emphasizes the importance of analyzing trading hours, particularly from 8:00 AM to 9:30 AM, to identify high and low points within this range.

• This 90-minute window is crucial for setting a market bias, especially when anticipating bearish trends due to external factors like tariffs.

Analyzing Market Behavior

• The identified high and low during the pre-market period serve as reference points for potential buy-side and sell-side liquidity pools.

• The speaker clarifies that while these levels are significant, they do not dictate absolute price movements but rather frame initial trading strategies.

Algorithmic Trading Insights

• The first hour of trading is highlighted as foundational for understanding market algorithms and their impact on price movements.

• Observations over time suggest a consistent pattern where algorithms influence market behavior, leading traders to consider whether luck or systematic strategies are at play.

Liquidity Pools and Market Manipulation

• The discussion includes how markets often gravitate towards established highs before moving lower, indicating strategic positioning by smart money.

• A focus on buy stops above certain highs suggests that algorithmic trading can manipulate prices to benefit larger players in the market.

Identifying Key Candlestick Patterns

• Specific candlestick formations are described as indicators of "venom," which refers to sharp price movements that can trap short sellers.

• The concept of "venom" is further explained through the analogy of snakes, illustrating how sudden price spikes can create opportunities for savvy traders.

Advanced Trading Techniques

• A distinction is made between traditional reversal patterns and more advanced techniques that leverage candlestick behavior for entry points.

• Emphasis is placed on recognizing changes in delivery states based on candlestick closures relative to previous highs, guiding traders toward optimal entry strategies.

Understanding Trading Strategies and the Venom Model

The Importance of Timing in Trading

• The sell side during the 90-minute window at 9:30 is straightforward, but traders may miss some trades if they don't adapt quickly to market movements.

• Focusing solely on price can lead to guesswork; understanding time-oriented price delivery is crucial for successful trading.

• Acknowledgment of proven strategies is essential, as many refuse to accept effective methods despite consistent results over months.

Demonstrating Trading Techniques

• The speaker emphasizes transparency by using a demo account for trading examples, ensuring personal accounts remain unaffected.

• Acknowledges that difficult sessions are expected but highlights the importance of recognizing setups when they form.

Introduction to the Venom Model

• The "Venom" model involves identifying bullish runs in bearish markets within specific time frames, focusing on buy and sell envelopes.

• Candlestick patterns play a significant role; an efficient higher candlestick indicates potential market movement against short positions.

Execution and Market Context

• Entry points are determined based on fair value gaps, with careful observation of price action rather than drawing attention to the Venom model itself.

• Misinterpretations of the Venom model by others highlight its uniqueness; not all strategies claiming similarity are valid or effective.

Understanding Market Dynamics

• Successful execution relies on market predisposition towards one direction; setups won't appear in choppy trading ranges.

Market Manipulation and Trading Insights

Understanding Market Volatility

• The market is described as highly manipulated with significant volatility, yet it continues to deliver impressive results. The speaker expresses enthusiasm for this dynamic.

• A specific entry point at 8,991 is highlighted, indicating a strategic position within a gap in the market. This reflects a trading strategy that capitalizes on market inefficiencies.

Personal Journey in Trading

• The speaker shares their personal experience of entering trades when the market showed signs of weakness, emphasizing confidence derived from past experiences.

• There’s an acknowledgment of reluctance in sharing knowledge about trading strategies, stemming from a sense of responsibility to teach others effectively.

Unique Perspectives on Trading Strategies

• The speaker critiques common perceptions within the trading community regarding the legality and ethics of certain trading insights, suggesting that many are unaware of deeper market mechanics.

• Various terms like "bid balance," "sell-side efficiencies," and "order blocks" are introduced as part of advanced trading concepts that are often overlooked by mainstream traders.

Teaching Methodology and Model Formulation

• Emphasis is placed on not reinventing existing models but rather providing more examples to help traders formulate their own strategies based on established principles.

• The speaker stresses the importance of understanding core elements behind their model (Venom), which allows for consistent application in real-world scenarios.

Critique of Other Traders' Practices

• A distinction is made between genuine teaching methods versus those who merely use buzzwords without practical application or understanding.

• Caution is advised against following traders who rely on simulated environments (market replay), as true expertise should be demonstrated through live trading scenarios.

Authenticity in Trading Education

• The speaker warns against individuals pretending to be knowledgeable while lacking real experience or understanding, highlighting the prevalence of fraud in the trading community.

• Imitation within the industry is criticized; it’s seen as disingenuous when others attempt to claim credit for established concepts without proper comprehension or execution.

Practical Application and Market Analysis

• An example involving fair value gaps illustrates how these concepts can be applied practically. It shows how markets react around these gaps during trades.

• Discussion includes analyzing candle patterns and price movements to identify potential trade entries based on algorithmic strategies rather than random guessing.

Market Analysis and Trading Strategies

Understanding Inversion Fair Value Gaps

• The speaker discusses the concept of inversion fair value, highlighting its weaknesses when trading below electronic trading hours. They mention a manual exit that resulted in missing potential gains as the market moved significantly higher.

• Observations are made regarding volume imbalances during electronic trading hours, indicating inefficiencies in sell-side liquidity and buy-side efficiency.

• The morning session is analyzed, emphasizing sell-side balance and buy-side efficiency. The speaker notes that these patterns support a bearish outlook for the market.

Key Trading Periods and Patterns

• Introduction to the New York Lunch Period (11:30 AM - 1:30 PM ET), where traders anticipate specific macro movements based on prior price action.

• At 10 AM, traders should identify high points when bearish trends are expected. This analysis leads to expectations of market movement towards those highs by 11:30 AM.

Afternoon Session Dynamics

• Discussion on how the market reacts post-lunch, with emphasis on reclaiming order blocks and clearing buy-side liquidity. A breakdown occurs through key levels established earlier in the day.

• The importance of maintaining a notepad with critical levels is stressed; this helps traders monitor price actions relative to established thresholds throughout the day.

Afternoon Opening Range Insights

• The opening range for the PM session (1:30 PM - 2:00 PM ET) is introduced, focusing on how it influences subsequent trades based on fair value gaps identified earlier.

• Traders are advised to watch for price reactions at previously identified fair value gaps, which can indicate potential entry points for trades as they respect volume balances.

Model Effectiveness and Community Engagement

• A sophisticated model is presented that integrates previously taught concepts into actionable strategies. The speaker emphasizes its effectiveness when parameters align correctly in real-time trading scenarios.

• The speaker reflects on their presence in other traders' live streams, noting community engagement and recognition from peers as evidence of their model's success in practice.

• There’s an acknowledgment of new students attracted by demonstrated success within various trading communities, reinforcing the importance of humility and accurate judgment against misinformation about their methods.

Understanding the Learning Process in Trading

The Importance of Active Engagement

• Simply watching videos is insufficient for mastering trading; true learning requires active participation, including backtesting and journaling.

• Many learners underestimate the complexities involved in trading, which can lead to feelings of frustration and a sense of wasted time during the initial learning phase.

Self-Reflection and Accountability

• Acknowledging personal responsibility is crucial; many learners fail because they do not confront their own shortcomings or mistakes.

• Being teachable is essential; learners often seek to cherry-pick information rather than fully commit to understanding a single method or strategy.

The Dangers of Mixing Strategies

• Attempting to blend different strategies without a solid foundation can lead to confusion and ineffectiveness; sticking with proven methods is advised.

• Authenticity in trading strategies matters; trying to repackage existing concepts will not yield success if they are not understood deeply.

Analyzing Market Trends

• When analyzing charts, specific levels such as consequent encroachment are critical for setting targets and making informed decisions.