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ICT February 2023 FOMC
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ICT February 2023 FOMC

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The speaker introduces themselves and apologizes for a delay in the beginning of the video.

Introduction

  • The speaker thanks the audience for joining.
  • They mention that they are not sure if everything is working properly yet.

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The speaker mentions that they will be discussing FOMC each month this year and explains their approach to trading during these events.

Trading FOMC

  • The speaker states that they do not like to trade during FOMC days.
  • They mention that they want to wait and see how the market reacts after 2 o'clock, as the first move is usually not the real move.
  • They compare the market movement during FOMC to a tsunami effect.
  • The speaker observes the price level at 40.91 and a quarter, considering it too smooth and uncertain.

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The speaker continues to observe the market during FOMC and advises caution in trading.

Observing Market Action

  • The speaker notes that they are just observing and waiting for any noteworthy developments.
  • They express skepticism about certain price levels being too smooth or suspect.
  • The speaker emphasizes that they are not actively trading but rather studying how liquidity is sought by the market.

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Volatility increases as FOMC announcements begin.

Market Volatility

  • Volatility increases as sell-side activity becomes prominent.

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The speaker analyzes recent price action and identifies potential areas of interest.

Analyzing Price Action

  • The speaker highlights equal highs at certain price levels, indicating potential resistance or support areas.

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The speaker advises against trading during this time and explains their approach to FOMC events.

Caution in Trading

  • The speaker discourages trading at the moment, considering it a gamble.
  • They explain that they do not trade FOMC events before 2:45 PM New York local time.
  • The speaker mentions that they may trade after 2:45 PM but treat it as a gamble due to uncertainty.

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The speaker discusses the two-stage nature of FOMC events and plans to observe until 3 o'clock.

Two-Stage Event

  • The speaker explains that there is an initial move before 2:30 PM and a real move between 2:30 PM and 2:45 PM.
  • They mention that they will continue observing until around 3 o'clock before ending the video.

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The speaker continues to observe market behavior and liquidity levels.

Observing Liquidity

  • The speaker notes attempts to go lower within the range prior to 2 o'clock.
  • They highlight areas of liquidity and inefficiency in the market.

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The speaker emphasizes the importance of understanding market dynamics before making trades.

Understanding Market Dynamics

  • The speaker states that knowing when to buy or sell involves more than just looking at price levels.

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The speaker questions why anyone would want to trade at this point, considering it a gamble.

Caution in Trading

  • The speaker expresses confusion about why someone would want to trade at this moment, emphasizing the risk involved.

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The speaker focuses on observing price action and potential areas of interest.

Observing Price Action

  • The speaker annotates the chart to highlight areas of inefficiency and liquidity.
  • They mention that they are studying the market to gain insight leading up to 2:30 PM.

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The speaker discusses the potential for a case study at 2:30 PM but advises against live trading.

Case Study Potential

  • The speaker suggests that there may be a case study opportunity at 2:30 PM based on relative equal highs.
  • They caution against placing live trades and emphasize the need for further observation.

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The speaker discusses potential price levels if buy-side liquidity is reached.

Buy-Side Liquidity

  • The speaker mentions that if buy-side liquidity is reached, the market may move towards certain price levels.
  • They clarify that this is not a trade recommendation but an observation based on their analysis.

Consequent Encroachment and Buy Side Purge

The speaker mentions the concept of "consequent encroachment" and discusses the buy side purge in the market.

Consequent Encroachment and Buy Side Purge

  • The speaker refers to "consequent encroachment" as a significant event in the market.
  • The buy side has been purged, resulting in a sell side imbalance and buy side inefficiency.
  • The current candle represents a delivery on the downside, indicating a sell side imbalance.
  • The market has repriced back to a certain level but has not achieved balance yet.

Justifying Accessory for an Event like FOMC

The speaker discusses the need for justification when it comes to events like FOMC (Federal Open Market Committee).

Justifying Accessory for an Event like FOMC

  • Reaching the midpoint of a specific range is not enough to justify accessory for an event like FOMC.
  • There needs to be sufficient energy in the market to reach through the high end of the range.
  • A significant gap exists between current levels and reaching higher levels.

Repricing vs. Rebalancing

The speaker explains the difference between repricing and rebalancing in relation to market movements.

Repricing vs. Rebalancing

  • The market has repriced back to a certain level but has not achieved balance yet.
  • Repricing means adjusting prices without achieving balance or equilibrium.
  • To achieve rebalancing, the market needs to leave its current range, either by going lower or higher before rallying.

Favoring Buy Side Despite Lack of Balance

The speaker expresses a preference for the buy side despite the market not being balanced.

Favoring Buy Side Despite Lack of Balance

  • The speaker still favors the buy side in the market.
  • Retail traders may anticipate a downward movement, but the speaker's mindset is to attack them.
  • The speaker mentions a desire to see an aggressive move above a certain high level and into higher territory.

Observing High Levels and Retail Traders' Sentiment

The speaker discusses observing high levels and retail traders' sentiment.

Observing High Levels and Retail Traders' Sentiment

  • The speaker focuses on observing a specific high level in the market.
  • Retail traders may have bearish sentiment and expect further downside movement.
  • However, the speaker maintains a buy-side perspective.

Aggressive Move Above High Level

The speaker expresses interest in seeing an aggressive move above a certain high level.

Aggressive Move Above High Level

  • The speaker wants to see an aggressive move that surpasses a specific high level.
  • This move would involve trading into higher price levels, potentially reaching 40.92 or even 41.00.

Leaving Range and Noteworthy Market Behavior

The speaker discusses leaving the current range and noteworthy market behavior.

Leaving Range and Noteworthy Market Behavior

  • If the market shows willingness to trade away from its current range without returning inside it, it becomes noteworthy.
  • A potential move lower at 2:30 PM is mentioned as something worth observing.
  • It is emphasized that these are early observations, and caution should be exercised before making any trading decisions.

Cautionary Note for Traders

The speaker provides a cautionary note for traders and emphasizes the need for discipline.

Cautionary Note for Traders

  • The speaker advises against pushing the button to enter trades on this particular day.
  • New and unseasoned traders should exercise caution and not engage in trading during volatile market conditions.
  • Trading on days like this can be extremely painful and may result in quick losses.

Favoring Buy Side and Observing Market Behavior

The speaker reiterates a preference for the buy side and discusses observing market behavior.

Favoring Buy Side and Observing Market Behavior

  • Despite previous cautionary notes, the speaker still favors the buy side in the market.
  • The focus is on observing how the market trades after reaching a certain high level (40.92).
  • Uncertainty remains regarding whether there will be an explosive move into higher price levels.

Observations on Clean Price Levels

The speaker comments on clean price levels and their significance.

Observations on Clean Price Levels

  • A specific high level is identified as having multiple attempts to go lower but being rejected each time.
  • These clean price levels are considered significant in terms of market behavior.
  • Further observation is required to determine if these levels will hold or be breached.

Consequent Encroachment, Repricing, and Stalling

The speaker discusses consequent encroachment, repricing, and stalling in relation to market movements.

Consequent Encroachment, Repricing, and Stalling

  • Consequent encroachment refers to full repricing to inefficiency in the market.
  • Despite attempts to go lower, the market has yet to go above a certain high level.
  • Stalling and staggering movements should not be trusted in this market environment.

Day Not Suitable for New Traders

The speaker advises against trading on this particular day, especially for new traders.

Day Not Suitable for New Traders

  • New traders are cautioned against trading on days like this due to the potential for quick losses.
  • Engaging in such volatile market conditions without discipline can be detrimental.
  • Mentors should not encourage inexperienced traders to trade during such events.

Real Move Yet to Begin

The speaker mentions that the real move is expected to begin in about 15 minutes.

Real Move Yet to Begin

  • The speaker anticipates that the real move in the market will start soon.
  • This upcoming move is expected to be significantly different from what has been observed so far since 2 o'clock.
  • The second part of FOMC at 2:30 PM is mentioned as the time when significant motion typically occurs.

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In this section, the speaker discusses a potential institutional order for entry and explains the concept of pyramiding entries.

Institutional Order for Entry

  • The speaker points out a small gap in the price action and mentions that on any other day, they would consider it as an institutional order for entry.
  • They explain that they would expect the price to rally up and potentially reach a buy level.

Pyramiding Entries

  • The speaker mentions that they often use pyramiding entries when going long on a trade.
  • They start with a core entry position of six contracts and then gradually reduce the number of contracts with subsequent entries.
  • This strategy allows them to build up their position while managing risk.

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In this section, the speaker explains the concept of PD array (premium discount array) and how it helps anticipate price movements.

PD Array and Price Levels

  • The speaker introduces the concept of PD array, which consists of specific elements in price action that repeat over time.
  • They mention that certain price levels act as sensitive points in price action.
  • The top of a candle is highlighted as one such point, along with mean threshold and consequent encroachment.

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In this section, the speaker mentions that there will be a change in market mood soon and apologizes for not being able to provide a preamble due to personal reasons.

Change in Market Mood

  • The speaker informs that there will be a change in market mood in approximately 11 minutes from now.
  • They apologize for not being able to provide a proper preamble but assure that it might be better to dive right into analyzing the market.

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In this section, the speaker discusses the importance of studying price action and shares their perspective on potential market movements.

Observing Price Action

  • The speaker emphasizes that events like these provide an excellent opportunity to study liquidity in the market.
  • They encourage viewers to approach it as a case study rather than a pass or fail test.
  • Multiple instances of lows being broken and highs being taken are highlighted on the chart.

Trustworthy Resistance Levels

  • The speaker suggests that certain levels, such as 40 89 three-quarters and 40 91 and a quarter, may be considered trustworthy for resistance.
  • They mention that traders with less experience might see these levels as opportunities to go short, but they caution against assuming market direction during FOMC meetings.

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In this section, the speaker explains their mindset regarding potential market movements and encourages viewers to learn from observing price action.

Learning from Market Movements

  • The speaker shares their current mindset of expecting traders who anticipate a short move during FOMC meetings to be vanquished.
  • They emphasize that being right or wrong is irrelevant to them personally but engaging for students to analyze and learn from.
  • Viewers are encouraged not to focus on potential gains or losses but rather study what actually happens in the market.

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In this section, the speaker highlights the unpredictable nature of FOMC meetings and advises caution when trading during such events.

Unpredictability of FOMC Meetings

  • The speaker compares FOMC meetings to carnival rides, stating that no one knows what the market will do during these events.
  • They stress that they personally choose not to trade in such environments due to uncertainty.
  • Viewers are advised not to dwell on potential gains or losses but instead treat it as an opportunity to observe and learn from price action.

Timestamps are approximate and may vary slightly.

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In this section, the speaker encourages viewers to be cautious when entering the marketplace on a day with high market volatility. They emphasize the risk involved and suggest that it is better to avoid trading on such days.

Importance of Cherry Picking Trades

  • The speaker advises viewers to cherry pick their trades carefully, especially on days with high market volatility.
  • Market events can be riskier than regular trading days or high impact news-driven days.
  • It is important to understand the potential harm that can occur if one is not experienced enough to navigate through volatile market conditions.

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In this section, the speaker discusses how a volatile market day can be tricky and give traders a false sense of confidence. They share their own prediction for a specific price level but also highlight the importance of being prepared for both correct and incorrect predictions.

Tricky Nature of Volatile Market Days

  • Volatile market days can give traders an impression that they have figured out the market movements.
  • The speaker shares their belief in a specific price level's potential rise but acknowledges that they could be wrong.
  • Being able to admit mistakes and learn from them is crucial in trading.
  • Traders should not rely solely on luck or temporary success but instead focus on understanding market dynamics.

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In this section, the speaker emphasizes their role as a mentor who aims to guide traders away from unnecessary risks. They express their desire for viewers to understand the importance of avoiding harm in volatile market conditions.

Role as a Mentor

  • The speaker wants to serve as a mentor who discourages taking unnecessary risks during volatile market conditions.
  • They believe it would be beneficial if they are proven wrong about their predictions, as it would reinforce their advice against trading on such days.
  • Traders should not expect to succeed in volatile market conditions if even experienced traders struggle.

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In this section, the speaker highlights the importance of caution and avoiding harm in volatile market conditions. They compare themselves to a coach who advises against participating in risky situations.

Avoiding Harm in Volatile Markets

  • The speaker emphasizes that it is better for them to be wrong about their predictions, as it reinforces their advice against trading on volatile market days.
  • If even an experienced trader like the speaker struggles on such days, it is unreasonable to expect others to come out unharmed.
  • Their intention is to mentor traders and discourage them from engaging in risky behavior.

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In this section, the speaker reiterates their role as a mentor and expresses their commitment to guiding traders away from harmful practices.

Mentor's Role

  • The speaker aims to be a mentor who does not encourage reckless trading or provide temporary highs through risky trades.
  • Their focus is on providing guidance and helping traders avoid potential harm.

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In this section, the speaker discusses observing price movements and identifies specific levels that may act as support or resistance.

Observing Price Movements

  • The speaker suggests watching the midpoint of a particular price movement for potential support or resistance levels.
  • Sensitivity at these levels can indicate whether prices will continue higher or reverse direction.

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In this section, the speaker mentions that there are approximately four minutes left until a significant retail trade activity occurs. They imply that some traders may regret their decisions later.

Retail Trade Activity

  • There are only a few minutes remaining before significant retail trade activity takes place.
  • The speaker suggests that some traders may regret their decisions to participate in trading on this day.

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In this section, the speaker mentions that some traders may overestimate their skills if they happen to get lucky during volatile market conditions.

Overestimating Trading Skills

  • Some traders may mistakenly believe they are better than they actually are if they experience temporary success due to luck.
  • The speaker implies that relying solely on luck is not a sustainable or reliable strategy in trading.

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In this section, the speaker indicates that there are only a few more minutes remaining before a significant event occurs.

Countdown

  • The speaker mentions that there are only a few minutes left until an important event takes place.

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In this section, the speaker shares their perspective on how they would manipulate prices if they had control over them during volatile market conditions.

Manipulating Prices

  • The speaker imagines how they would manipulate prices if they had control over them during volatile market conditions.
  • They consider the potential damage they could cause by taking advantage of traders' positions and emotions.

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In this section, the speaker discusses their approach to studying market events and understanding how they unfold.

Studying Market Events

  • The speaker shares their interest in studying market events and observing how they unfold.
  • They enjoy analyzing different strategies used by market participants during these events.

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In this section, the speaker explains that they no longer focus on non-farm payroll data due to its lackluster performance in recent years. They discuss their thought process when practicing trading.

Non-Farm Payroll Data

  • The speaker mentions that non-farm payroll data has become less impactful in recent years.
  • When practicing trading, they imagine themselves controlling price movements and consider how they would manipulate them for maximum damage or profit.

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In this section, the speaker discusses the potential impact of a price movement on traders who have taken short positions.

Impact on Short Positions

  • Traders who have taken short positions may be at risk if prices move against them.
  • The speaker suggests a strategy where prices are manipulated to clear out short positions before reversing direction.

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In this section, the speaker reflects on their approach to trading and acknowledges that not every manipulation strategy will be successful. They find enjoyment in studying these strategies regardless of the outcome.

Enjoyment in Studying Manipulation Strategies

  • The speaker acknowledges that not every manipulation strategy

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The speaker discusses the interesting behavior of the market and mentions the fair value gap.

Market Behavior and Fair Value Gap

  • The speaker finds it interesting how the market behaves, comparing it to its own leash.
  • They mention that on this particular day, the fair value gap is being sensitive.
  • The speaker suggests watching a video later on to understand more about this topic.

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Unfinished business in the market is discussed, along with potential levels for support and resistance.

Unfinished Business and Support/Resistance Levels

  • The speaker points out a specific level (40 92 and a quarter) as unfinished business in the market. They expect it to be broken through.
  • They express their desire to be wrong about their predictions for the day.
  • The speaker mentions that some viewers may think they want to trade FOMC (Federal Open Market Committee).

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Breaker range analysis is explained, along with potential price targets.

Breaker Range Analysis and Price Targets

  • The speaker identifies a breaker range on the chart and suggests accumulating long positions within that range.
  • They mention a specific price target of 4108 for an upward move.
  • A lot of people are surprised by the current market movement.

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The speaker shares their trading strategy and expectations for further price movements.

Trading Strategy and Price Expectations

  • The speaker expresses their trading strategy of closing positions and setting tight stop losses. They expect the market to reach 4108 and 4112.
  • They find the current market situation enjoyable.
  • The speaker emphasizes the importance of price action analysis and mentions new bull flags and trend lines.

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The speaker comments on the market approaching a specific price level.

Market Approaching a Price Level

  • The speaker notes that the market is almost reaching the 4108 level.
  • They express their desire to fail at least once during the day, indicating that they don't want the market to reach 4108.

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The speaker addresses viewers on Twitter and asks for feedback.

Addressing Viewers on Twitter

  • The speaker mentions viewers on Twitter and invites them to respond if they watched the live session.
  • They try to gauge any delay in communication with viewers.

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The speaker reflects on their trading decisions and mentoring approach.

Trading Decisions and Mentoring Approach

  • The speaker discusses their trading decisions based on price movements, emphasizing understanding price action without actually executing trades themselves.
  • They advise viewers who are currently in a trade to exit it and be content with their profits without sharing details or results.

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A potential price range is suggested, along with final remarks from the speaker.

Potential Price Range and Final Remarks

  • The speaker suggests adding horizontal lines at 4115 and 4125 on the chart as potential price levels. They reiterate their target of 4112.
  • The speaker concludes by hoping that viewers found the session helpful and asks for feedback on Twitter.
Playlists: 2023 ICT Mentorship
Video description

Government Required Risk Disclaimer and Disclosure Statement 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.