ICT 2024 Mentorship \ Limit Orders & Volatility Pinball Drills \ October 01, 2024

Name: ICT 2024 Mentorship \ Limit Orders & Volatility Pinball Drills \ October 01, 2024
Uploaded: 2024-10-01T15:28:37.000Z
Duration: 7 h 52 min 56 s

Introduction to Price Action Trading

Engaging with the Audience

The speaker greets the audience and requests feedback on audio quality, indicating an interactive session.

Emphasizes the goal of inspiring participants to engage more deeply with price action study and effective use of demo accounts.

Understanding Limit Orders

Introduces a price action drill aimed at helping users understand limit orders, which are considered essential for precise trading entries.

Discusses personal trading practices, including using market orders primarily for demonstration purposes rather than actual trading strategy.

Market Orders vs. Limit Orders

Clarifying Market Order Usage

The speaker explains their preference for market orders as a way to demonstrate trades without relying on market replay features.

Highlights a student's concern about potential doubts regarding the authenticity of trades shown during lessons.

Importance of Precision in Trading

Stresses that while market orders can lead to less precise entries, limit orders provide better control over trade execution.

Mentions the importance of overcoming fear associated with short selling, sharing personal experiences from their early trading days.

Desensitizing Fear in Trading

Overcoming Psychological Barriers

Reflects on past fears related to short selling and how they created hypothetical scenarios to practice trading decisions.

Describes backtesting methods used in earlier years when resources were limited compared to today's technology.

Learning Through Practice

Encourages current traders to utilize available resources like demo accounts for live data practice instead of outdated methods like hand-drawn charts.

Shares teaching strategies used in mentorship programs aimed at helping students overcome fear and build confidence in entering trades.

The Evolution of Trading Mindset

Personal Journey in Trading

Discusses initial reluctance towards short selling due to a lack of understanding and confidence during early trading experiences.

Contrasts feelings about buying versus selling; highlights how passion for learning outweighed fears despite experiencing losses.

Adapting Strategies Over Time

Explains how changing market conditions necessitated adapting strategies from solely buying stocks to incorporating short selling techniques.

Trading Drills and Overcoming Fear in Trading

The Importance of Practice in Trading

The speaker reflects on advice from mentor Larry Williams, emphasizing the need to take trades without emotional attachment to outcomes.

A demo account is highlighted as a valuable tool for practicing trade executions, particularly for learning how to use limit orders effectively.

Today's session focuses on intraday volatility rather than making profitable trades; the goal is to practice engaging with price action.

Embracing Losses as Learning Opportunities

The speaker acknowledges that losing trades will occur during practice sessions, reinforcing that the objective is not profit but skill development.

Even experienced traders continue using demo accounts for drills, likening it to meditation and a way to stay connected with market dynamics after breaks.

Timing and Market Conditions

New students are advised against trading during specific volatile periods like non-farm payroll week unless they are well-prepared and knowledgeable about market conditions.

After significant news events (e.g., employment data), there are opportunities for informed trading if one understands market manipulation.

Addressing Misconceptions About Trading Skills

The speaker anticipates criticism from viewers who may misinterpret today's drills as evidence of poor trading skills, stressing the educational purpose behind them.

Emphasizing daily practice (10+ times), the speaker encourages overcoming fear of entering trades through consistent engagement with smaller time frames.

Practical Application of Trading Techniques

During recent drills with students, the focus was on executing trades without bias while managing stop losses and profit targets based on real-time volatility.

Interactive Trading Experience

Overview of the Interactive Study

The session will be an interactive study simulating constant buying and selling, focusing on executing limit orders without market orders or stop losses.

Participants are encouraged to journal their feelings during trades, noting emotional responses to price movements—either reaching targets or getting stopped out.

Trading Methodology

The approach is not a traditional trading method; it focuses on identifying microstructure liquidity pools with minimal risk using only one contract per trade.

Emphasis is placed on avoiding pyramiding strategies in this exercise, contrasting with future mentorship plans that include teaching pyramiding techniques.

Execution and Charting Techniques

The focus will be on intraday volatility using short time frames (15-second, 1-minute, and 5-minute charts), rather than longer-term bias analysis.

Clarification that this drill is not a trading model like "ICT's Enigma," which does not involve losing trades as part of its methodology.

Understanding Emotional Responses in Trading

Fear and Execution Challenges

This drill aims to help traders confront fears related to execution and entry by evaluating internal emotional states during trades.

Key issues addressed include the desire to be right in trades, fear of losses outweighing wins, and how these emotions can impact decision-making.

Limit Orders vs. Market Orders

Training focuses on proper use of limit orders; market orders should only be used when exiting a trade that is clearly offside.

Using market orders indiscriminately can lead to poor trading habits; participants are encouraged to demonstrate open profits without relying on stop losses.

Overcoming Fear in Trading

Personal Journey and Teaching Philosophy

The speaker shares personal experiences overcoming fear in trading through self-taught methods rather than formal education.

Acknowledges that while some may not have initial fears about entering trades, increased position sizes can introduce anxiety over time.

Building Confidence Through Practice

Understanding Trading Psychology and Methodology

The Importance of Experience in Trading

New traders often lack experience, relying solely on demo accounts without understanding the expected outcomes, which can lead to poor habits.

It's crucial to focus on following a structured process or methodology rather than fixating on immediate trade results; this includes backtesting for statistical reliability.

Learning Through Practice and Journaling

The session aims to teach practical execution techniques while emphasizing that it's not a competition but an educational exercise.

Keeping a trading journal is recommended, whether using physical binders or digital devices, to track price action drills and personal progress.

Mimicking Techniques for Skill Development

Participants are encouraged to mimic the instructor's actions during the session as a learning tool, with an emphasis on not viewing these as trade signals.

The instructor expresses discomfort with others claiming they took the same trades without showing their executions, highlighting the uniqueness of his approach.

Building Confidence and Reducing Emotional Attachment

The goal is not merely winning trades but developing confidence in executing limit orders and practicing consistently over time.

By participating live, viewers gain an advantage in learning compared to those who watch recordings later.

Evaluating Progress and Learning from Mistakes

Emphasis is placed on desensitizing oneself from trade outcomes; practice should focus on refining entry mechanisms rather than immediate profitability.

Understanding Market Psychology and Daily Practice

The Importance of Emotional Awareness in Trading

The speaker discusses the emotional responses traders may experience when trades are stopped out or succeed, emphasizing the need for self-awareness.

Encourages daily practice among students, highlighting that consistent engagement with trading is crucial for skill retention and improvement.

Continuous Learning and Skill Maintenance

Compares trading practice to professional athletes like Tiger Woods, who continually refine their skills to maintain performance levels.

Introduces a discussion on analyzing daily charts, indicating that ongoing education is vital even for experienced traders.

Analyzing Candlestick Patterns

Explains the concept of volume imbalance in candlestick patterns, stressing its significance in market analysis.

Describes how specific price action setups can be identified through the relationship between candle bodies and surrounding candles.

Understanding Price Dynamics

Mentions a particular price dynamic (PD array), hinting at its complexity without revealing too much detail to avoid oversaturation of information.

Clarifies that his teachings are not aimed at selling books but rather sharing knowledge about effective trading strategies.

Utilizing Fibonacci Levels in Trading

Discusses using Fibonacci retracement levels to identify equilibrium points within price ranges, which helps anticipate future market movements.

Emphasizes the importance of understanding these levels as part of a broader strategy rather than merely reacting to market changes.

Anticipating Market Movements

Highlights the necessity of anticipating market behavior based on established frameworks rather than reacting impulsively during trading sessions.

Understanding Trading Limitations and Opportunities in Asia

Trading Constraints for Working Individuals

The speaker discusses the challenges faced by working individuals who cannot trade during major market sessions like New York or London due to work commitments, leading them to focus primarily on the Asian session.

Anticipating Setups in the Asian Session

The speaker plans to provide insights on how to anticipate trading setups specifically during the Asian session, emphasizing that not every day will present favorable trading opportunities.

Daily Chart Analysis and Key Levels

A blue shaded area on the daily chart represents volume imbalances, indicating significant price levels from previous analysis. These levels are crucial for understanding potential market movements.

Relative Equal Highs and Market Manipulation

The concept of relative equal highs is introduced as a method used by traders to identify liquidity zones. This manipulation can lead to price drops as traders chase breakouts.

Importance of Technical Analysis Literature

The speaker emphasizes the significance of John Murphy's "Technical Analysis of the Financial Markets," describing it as essential reading for retail traders. Understanding this perspective helps in recognizing common trader behaviors that can be exploited.

Retail Trader Behavior and Breakout Strategies

When prices exceed certain highs, retail traders often place buy stop orders anticipating breakouts. The speaker highlights how understanding these patterns can inform better trading strategies.

New Day Opening Gaps Explained

Understanding Market Dynamics and Retail Trading Strategies

The Importance of Annotation in Trading

The speaker emphasizes the necessity of having annotated charts to avoid confusion in trading decisions. Without annotations, traders risk losing track of their levels.

Retail traders often rely on their indicators and strategies, such as momentum trading, believing these methods are effective despite potential pitfalls.

Analyzing Breakout Points

The speaker identifies key reference points for monitoring price behavior after a breakout, particularly focusing on stop-loss placements by retail traders.

A common gap is highlighted as significant due to its proximity to the inception of price movement, which retail traders perceive as support.

Price Behavior and Volume Imbalances

Observing how prices react at specific levels is crucial; if prices drop below certain lows, it indicates further downward movement may occur.

The discussion includes the concept of dual volume imbalances on daily charts and how they inform predictions about market movements.

Predictive Analysis vs. Reactive Trading

The speaker stresses the importance of predicting future price actions rather than merely reacting to them, emphasizing a proactive approach in trading strategies.

A distinction is made between demand zones and other market dynamics; understanding where buying pressure exists is essential for anticipating price movements.

Liquidity and Market Levels

The conversation shifts towards liquidity analysis, indicating that traditional support/resistance methods may not capture critical market levels effectively.

Mentorship and Entry Models

Mentorship Availability

The speaker emphasizes that they are currently teaching mentorship for free and will not be offering it again in the future. They discourage sending emails regarding joining the mentorship.

Indigo Entry Model Overview

The Indigo entry model is introduced as a strategy involving a volume imbalance above a candle, characterized as a run on stops with an order block.

The speaker notes that the full details of the Indigo entry model will not be taught until published, but hints at its reliance on previously introduced logic.

Liquidity Considerations

A key concept discussed is that entries must either target liquidity or address inefficiencies in price, such as gaps. This understanding is crucial for making informed trading decisions.

The speaker explains how to identify when to avoid buying into certain market conditions by analyzing relative equal lows and their implications for trade outcomes.

Trade Execution Insights

The importance of waiting for price action to reach specific levels before executing trades is highlighted, particularly focusing on gaps and liquidity zones.

Discussion includes strategies around stop-loss orders and how retail traders might react to market movements, emphasizing the need for strategic planning.

Understanding Price Action Dynamics

The Indigo entry model combines several factors including liquidity targets and volume imbalances. It’s essential to understand these dynamics rather than relying solely on traditional indicators.

Emphasis is placed on observing price behavior below certain lows and recognizing patterns that indicate potential trade opportunities.

Teaching Philosophy

The speaker reflects on their unique approach to teaching trading concepts, asserting that their methods are original and not derived from existing literature or mentors.

They position themselves as an "anti-Guru," aiming to provide practical insights rather than conventional wisdom often found in trading education.

Practical Application of Concepts

A reminder is given about the purpose of various price dynamics; they serve as indicators rather than definitive stopping points in market movement.

Specific examples are provided regarding how to navigate through different market scenarios using real-time analysis of candles and volume imbalances.

Video Content Strategy

The speaker discusses their video content strategy aimed at engaging viewers while delivering educational material efficiently, acknowledging modern attention spans influenced by platforms like TikTok.

Understanding Candlestick Patterns and Volume Imbalance

The Value of Mentorship in Trading

The speaker emphasizes the value of the information being shared, likening it to paid mentorship despite being offered for free.

Highlights the significance of the separation between candlestick bodies, indicating a shaded area that represents critical trading insights.

Analyzing Volume Imbalance

Discusses how volume imbalance is created when a candle opens at a lower price and trades up, establishing a buy-side delivery body.

Points out that wicks are often ignored as they do not represent solid price action; focus should be on volume and balance instead.

Technical Analysis Rules

Clarifies that while there are straightforward rules in technical analysis, understanding volume imbalance requires deeper insight beyond just two consecutive candles.

Explains that if the open and close prices are identical, it indicates no real body exists for that candle, which affects analysis.

Liquidity Voids Explained

Defines liquidity void as an absence of executed orders between candlesticks' high and low prices; this is crucial for identifying trading opportunities.

Illustrates how sell-side delivery can occur through gaps where no trading has happened, emphasizing the importance of recognizing these patterns.

Mastering Execution in Trading

Acknowledges that mastering complex concepts may not be necessary for all traders but is essential for those seeking world-class execution.

Encourages dedication to studying advanced techniques to achieve superior trading results compared to average market participants.

Understanding Candlestick Patterns and Market Dynamics

Analyzing Candlestick Behavior

The speaker emphasizes the importance of observing candlestick patterns without needing to draw lines, focusing on volume imbalance and relative positions of candlesticks.

A specific candlestick opens, trades down briefly, but is expected to close high due to its wick behavior, indicating a potential reversal.

The closing price of a significant candlestick is highlighted as it aligns with previous price levels, showcasing the precision in market movements.

Liquidity and Market Reactions

The discussion shifts to how price actions create liquidity pools that can be exploited by traders; understanding these dynamics is crucial for effective trading strategies.

Observations are made about how market drops can trigger stop losses for long positions while maintaining an overall bullish outlook based on prior analysis.

Timing and Trade Execution

The speaker notes the timing of market movements within specific macro periods (e.g., 750 to 810), suggesting that this influences trade decisions significantly.

Emphasis is placed on recognizing when price begins to "spool," indicating preparation for movement towards inefficiencies or liquidity pulls in the market.

Order Blocks and Entry Strategies

The concept of order blocks is introduced as critical areas where traders should look for entries; these are identified through previous price action patterns.

The speaker likens their trading strategy to hunting, positioning themselves strategically within defined ranges (order blocks) to capitalize on favorable conditions.

Gaps and Market Psychology

Discussion includes how gaps in pricing can signal opportunities; understanding these gaps allows traders to anticipate future movements effectively.

A comparison is drawn between traditional trading concepts (like Elliott Wave theory) and the speaker's unique approach, which focuses more on real-time data interpretation rather than theoretical models.

Practical Trading Insights

The speaker asserts their expertise in identifying gaps post-filling with precision, claiming a unique ability not commonly found among traders.

Closing remarks emphasize simplicity in trading indicators—focusing on open-high-low-close values rather than complex systems enhances decision-making efficiency.

Understanding Mentorship and Trading Models

The Nature of Teaching and Learning

The speaker emphasizes the limitations of their mentorship, stating they will only share what is necessary without revealing everything. This creates a tension for some learners who feel transparency is lacking.

They clarify that while certain advanced concepts (like entry models) are not essential for understanding, they provide sufficient foundational knowledge through simpler models.

Key Principles in Trading Models

Introduction of Caleb's model which focuses on identifying fair value gaps during specific time frames, suggesting a structured approach to trading.

The speaker outlines three core principles that govern all their trading models: time, reasons for price movement (inefficiency), and market direction (buy/sell side).

Execution Strategies

Discussion on recognizing common gaps in the market as reliable indicators for trade entries, emphasizing clarity over ambiguity in decision-making.

A practical example is provided where the speaker describes an entry strategy based on market confirmation above a gap with defined stop-loss parameters.

Perception vs. Reality in Trading Models

The speaker acknowledges that while their proposed model may lack excitement or flashy branding, it remains effective and serves its purpose well within their trading strategy.

They express frustration about external pressures regarding book publication but assert that the depth of knowledge shared through lectures surpasses what can be captured in written form.

Trade Timing and Market Behavior

Emphasizes the importance of timing when entering trades; two conditions must be met: price moving towards inefficiencies at appropriate times.

Discusses waiting for specific candlestick formations to validate bullish order blocks before making trades, highlighting predictive elements involved in successful trading strategies.

Anticipating Market Movements

The speaker explains how they anticipate market movements by observing retail behavior around support levels and adjusting strategies accordingly.

Understanding Smart Money Concepts

Critique of Mentorship in Trading

The speaker emphasizes the importance of discerning genuine mentorship from those who merely demonstrate their understanding without comprehensive knowledge. They caution against following individuals who claim to teach "smart money concepts" or "ICT concepts" while selling mentorship.

The speaker argues that many mentors lack a complete grasp of the material, leading to losses in trading. They assert that true mastery is essential for consistent success and imply that they possess this mastery.

Personal Experience with Trading Strategies

The speaker shares their experience running a trading strategy called Enigma, claiming it operates flawlessly compared to other methods. They express confidence in its effectiveness but acknowledge the challenges of using it indiscriminately.

They highlight the potential for significant financial independence through effective trading strategies, suggesting that even one successful setup per week can replace traditional employment.

Challenges in Teaching and Learning

The speaker reflects on their attempts to teach others, noting difficulties due to varying levels of maturity and focus among students. They mention specific challenges faced by individuals like Cameron and Caleb regarding attention span and comprehension.

Acknowledging their own teaching style, they admit it may be difficult for some learners to follow along due to tangential discussions but emphasize the importance of persistence in learning these concepts.

Profit Phases and Market Dynamics

The discussion shifts towards market behavior during profit phases, where price movements favor traders. The speaker explains how prices should ideally behave when reaching certain thresholds on charts.

Emphasizing the significance of observing price actions at key levels, they describe what constitutes a strong price run versus weak retracements, advocating for clear breakout signals rather than mere support/resistance interactions.

Understanding Gaps in Price Movements

The distinction between breakaway gaps and measuring gaps is introduced. Breakaway gaps indicate significant future movement while measuring gaps suggest further price legs based on previous movements.

Trading Insights and Strategies

Understanding Market Dynamics

The speaker discusses identifying key market signatures, emphasizing the importance of recognizing relative equal highs to determine entry points for trades.

A specific buy-side liquidity pool is highlighted, showcasing how traders can place orders just before significant levels to maximize potential gains.

Trade Execution Techniques

The speaker explains the concept of trailing stop losses, suggesting that traders should adjust their stop loss as the market moves in their favor to secure profits.

The process of managing contracts during a trade is detailed, where the speaker describes taking off contracts at each higher high to optimize profit extraction.

Market Behavior Analysis

The discussion includes a metaphor about "strangling" a trade by continuously adjusting positions to capture maximum value until stopped out.

An analysis of market maker sell models is presented, illustrating how price movements can indicate stages of distribution and redistribution within the market.

Liquidity and Order Blocks

The speaker references inefficiencies in trading gaps that can persist beyond their formation day, citing an influential figure known as ICT who advocates for this perspective.

A clear distinction between bullish and bearish order blocks is made, emphasizing that these are critical for understanding liquidity purges in trading strategies.

Cautionary Notes on Trading Practices

A reminder is given that this session does not serve as a signal service; participants are cautioned against blindly copying trades without understanding the risks involved.

Personal anecdotes about teaching family members trading principles highlight the importance of education over mere execution in trading practices.

Goals and Accountability in Trading

The speaker shares insights into mentoring his son through trading challenges while stressing accountability and setting realistic goals for success.

Trading Strategies and Mindset

Importance of Trading with One Contract

Emphasizes the necessity of trading with only one contract to build trust and confidence in trading decisions, regardless of the contract size.

Highlights that using more than one contract increases fear and risk, potentially leading to significant losses due to leverage that traders cannot afford.

Advises against trying to recover from a losing trade by increasing the number of contracts; instead, accept the loss and maintain focus on long-term goals.

Understanding Volatility Pinball

Introduces the concept of "volatility pinball," which involves buying and selling using limit orders while practicing with a demo account to become desensitized to price action.

Stresses the importance of identifying fair value gaps, order blocks, and liquidity draws as essential skills for effective trading.

The Role of Practice in Trading

Argues that theoretical knowledge from books or videos is insufficient without practical application on charts; real engagement is necessary for learning.

Mentions having a large following on YouTube but notes that many viewers download content rather than watch it live due to concerns about potential removal.

Trading Approach and Mindset

Clarifies that current discussions are not about making money but rather about understanding entry points within market ranges.

Encourages traders to practice entering trades at specific price points without focusing solely on profit or loss outcomes.

Compliance and Transparency in Trading

States compliance disclaimers regarding not being a licensed financial advisor while demonstrating paper trading practices for educational purposes.

Understanding Trading Strategies and Account Management

The Logic Behind Trading Decisions

The speaker emphasizes the logical reasoning behind their trading actions, indicating that they share their trade history transparently to demonstrate accountability.

They express a strong opinion about the scrutiny of their trading account by others, highlighting a personal perspective on privacy and control over their trading data.

Daily Trading Routine

The speaker describes a daily routine in trading, showcasing consistency and discipline in executing trades without any losses indicated in their records.

They mention strategies for maintaining an active account while managing visibility of past trades to prevent copying by others.

Concerns About Copying Trades

Acknowledging skepticism from others regarding their trading abilities, the speaker asserts confidence in their skills and expresses frustration with critics who doubt them.

They discuss the potential risks associated with having someone access their annotations on trading platforms like TradingView, suggesting that it could lead to unauthorized copying of strategies.

Managing Perceptions and Privacy

The speaker explains how they manage their chart annotations to ensure that no one can replicate or copy their strategies easily.

They highlight the importance of controlling what information is accessible to others within the trading community, particularly those who might want to imitate successful trades.

Psychological Aspects of Trading

The speaker reflects on personal beliefs about being unmatched in trading skill compared to others, emphasizing a unique approach that sets them apart.

They describe feelings of paranoia regarding potential copying but also recognize this as part of a broader strategy for maintaining competitive advantage.

Resetting Accounts for Security

A detailed explanation is provided about resetting accounts after each session as a method to protect against imitation by other traders.

The process involves deleting previous executions and starting fresh after winning trades, which serves both as a psychological tactic and practical measure against copying.

Final Thoughts on Trade Management

The speaker advises against following them blindly when implementing these strategies but underscores the necessity of protecting one's unique methods from being replicated.

Understanding Trading Psychology and Live Execution

The Challenge of Distraction in Trading

The speaker emphasizes the importance of maintaining focus while trading, stating that distractions can significantly hinder performance.

They express concern about others potentially copying their trades on a demo account, which could lead to issues if those individuals are not experienced traders.

Personal Reflection on Trading Competence

The speaker invites listeners to consider their own trading abilities by asking how they would feel if someone else could replicate their successful trades without their knowledge.

They reveal that this thought process creates anxiety for them, as it raises questions about accountability and the potential impact on others' trading outcomes.

Managing Live Trade Commentary

The speaker requests that followers refrain from sharing whether they have copied trades during live streams, as this knowledge affects their mindset and decision-making.

They describe a method of resetting mentally before each session to maintain balance and avoid emotional swings during trading.

Transparency in Trading Practices

The speaker announces plans to share historical trade data for a specific week, clarifying that they do not owe extensive transparency beyond this timeframe.

They assert that viewers should not feel entitled to more than what is offered, emphasizing the personal motivation behind creating educational content.

Importance of Caution in Copying Trades

A strong warning is issued against copying trades with real accounts; the speaker stresses that doing so may lead to financial losses.

Their primary goal is teaching fundamental trading skills like placing limit orders and managing stop losses rather than encouraging risky behavior.

Preparing for Live Sessions

Before continuing with live execution demonstrations, the speaker takes a brief break to ensure uninterrupted focus during the session.

Understanding Market Dynamics and Trade Execution

Market Price and Liquidity Draw

The current market price is at 241.5, with potential targets identified as old lows or inefficiencies below the price level.

A blue shaded area indicates a trading inefficiency where the price is expected to move towards, representing a draw on liquidity.

Importance of Stop Losses

Emphasizes the necessity of having a stop loss in every trade; it's crucial for risk management and acknowledging when a trading idea is incorrect.

A stop loss acts as an insurance policy, signaling to the market that you accept being wrong if the price reaches this point.

Risk Management Strategies

The execution of trades should be based on logical reasoning; if prices reach your stop loss, it indicates a need to exit to prevent larger losses.

Viewing stop losses positively can help traders embrace them as protective measures rather than negative aspects of trading.

Framing Trade Setups

When expecting bearish movements, traders must determine their entry points and set appropriate stop losses based on market conditions.

For bearish setups, limit orders are placed above current market prices; this requires careful consideration of entry strategies.

Executing Limit Orders

To sell short effectively, one must place limit orders at strategic points above current prices while ensuring proper risk management through stop losses.

Conversely, bullish strategies involve placing buy limit orders below current market prices to capitalize on anticipated upward movements.

Analyzing Trade Performance

After executing trades, logging performance metrics such as unrealized profit and time taken to reach targets or stop outs is essential for improvement.

Understanding Limit Orders and Trading Mechanisms

The Importance of Personal Data Analysis

Traders should not solely rely on external data; they must become comfortable analyzing data themselves to enhance their trading skills.

Emphasis is placed on understanding market price movements, particularly the necessity for prices to drop before executing bullish trades.

Mechanics of Limit Orders

High-frequency trading algorithms utilize down ticks as entry points, indicating that prices must decrease for a successful buy limit order.

When placing buy orders, traders need to set limits below the current market price; conversely, selling short requires setting limits above market price.

Practicing Trading Drills

During practice drills, traders are encouraged to log every detail of their trades, including the time taken from entering an order until execution.

The focus during these drills is on gaining experience rather than making profits; both winning and losing trades contribute to learning.

Strategies for Identifying Trade Opportunities

Fair Value Gaps in Market Movements

Traders should look for fair value gaps after periods of market volatility or "jaggedness" as potential entry points.

The first fair value gap observed in the morning can be a significant indicator for trade decisions.

Utilizing Order Blocks and Institutional Strategies

Various mechanisms such as order blocks or institutional entry drills can be employed during practice sessions to refine trading strategies.

Counter-Trend Trading Techniques

Engaging with Market Trends

Counter-trend trading involves taking positions against prevailing market trends; this provides valuable experiential learning opportunities.

Traders are encouraged to identify small fair value gaps even when going against the underlying order flow, aiming for potential rebounds towards new week opening gaps.

Execution Challenges and Adjustments

Real-time adjustments may be necessary based on performance feedback from trading platforms; issues with tools like TradingView can hinder effective execution.

Understanding the Trading Mindset

Embracing Practice Over Fear

The speaker emphasizes that gaining experience in trading should be enjoyable rather than fear-inducing. It's important to practice without the pressure of achieving profitable results.

The notion of fear in trading is addressed; it's suggested that traders often create their own anxiety by expecting profitability, which detracts from the learning process.

Practicing with a demo account allows traders to explore various strategies, including using PD arrays and understanding liquidity without the risk of real losses.

Learning Through Experience

The speaker discusses the emotional challenges of making significant profits, highlighting that it can be more terrifying than expected due to uncertainty about how to react.

Engaging in practice sessions is likened to physical exercise; it’s essential for developing trading skills and confidence over time.

Strategic Trade Execution

When practicing, traders are encouraged to simulate real trades by taking partial profits at strategic points, which helps build a sense of security against potential losses.

The importance of annotating trades during practice is highlighted as a way to track progress and learn from each scenario effectively.

Realistic Expectations in Trading

The speaker references successful traders who focus on consistent gains rather than aiming for large wins, suggesting that smaller, steady profits can lead to substantial financial success over time.

A strategy involving pyramiding positions is mentioned but noted as not always applicable; traders should remain flexible and adapt based on market conditions.

Continuous Learning and Adaptation

Traders are reminded that their primary goal should be gaining experience rather than competing with others or solely focusing on profitability metrics.

Accepting market unpredictability is crucial; traders must learn to submit to market movements while maintaining composure during live trading situations.

Understanding Trading Psychology and Strategy

The Importance of Focus in Trading

Traders often become desensitized to "what if" thinking while in a trade, which distracts from analyzing price action effectively.

Observing individual candlesticks is crucial; traders should focus on whether the price indicates a continuation or reversal.

Analyzing Market Movements

If the market breaks above certain highs, it may signal further movement; however, traders should be prepared for potential reversals.

Documenting trades and outcomes is essential. For instance, annotating partial exits can help track performance and decision-making.

Practicing with Purpose

Engaging in daily drills helps reinforce trading strategies and build confidence against external comparisons with other traders.

Using only one contract during practice can mitigate fear and greed, allowing for more disciplined trading behavior.

Rewarding Progress

Taking partial profits during trades serves as a psychological reward, reinforcing positive behavior and reducing anxiety about holding positions.

Annotating partial exits encourages traders to look for opportunities to take profits, thus managing risk effectively.

Building Experience Through Live Data

Watching live trades provides valuable insights into execution but requires patience and emotional resilience from the trader.

Recording entry points and time taken for trades helps develop an understanding of market dynamics over time.

Managing Fear in Trading

Taking partial profits at strategic points reduces emotional stress associated with holding onto losing positions.

Even when trading small contracts, the psychological impact can feel significant; hence managing emotions is critical for success.

Overcoming Skepticism

Despite skepticism from others regarding live trading demonstrations, consistent practice builds credibility as a trader.

Acknowledging external opinions while focusing on personal growth is vital for maintaining confidence in one's trading abilities.

Conclusion of Morning Session Insights

Market Analysis and Trading Strategies

Observations on Market Movement

The speaker notes unusual market behavior, highlighting a significant difference between green (buying pressure) and red (selling pressure) candles, suggesting randomness in price action.

Emphasis is placed on the importance of identifying liquidity zones where the market may gravitate towards, which aids in framing stop losses for trades.

Execution Challenges

The speaker expresses concern about audio issues during the session, seeking confirmation from viewers if they can hear him clearly.

Discussion shifts to analyzing market lows and fair value gaps; the speaker stresses that not every trade needs to be successful as it’s part of learning.

Trading Exercises

The focus is on practicing trading strategies without fear of failure; even if a trade stops out, it's viewed as an opportunity to learn about market dynamics.

A specific strategy is discussed regarding waiting for price movements below certain levels before executing trades based on previous rejection points.

Fair Value Gaps and Liquidity Pools

The speaker reflects on missed opportunities with fair value gaps but emphasizes engaging with every instance of these gaps for practice.

It’s noted that directional bias simplifies trading decisions; however, range-bound markets can provide better practice conditions.

Live Trading Experience

The speaker attempts live trading while discussing strategies but feels pressured by audience expectations; he highlights the importance of self-execution over dependence on his actions.

Acknowledgment of mixed feelings about performing live trades in front of an audience; he believes students should engage directly rather than rely solely on his demonstrations.

Technical Analysis Insights

After executing a trade that hits its target after a stop-out scenario, the speaker prompts viewers to reflect on their emotional responses during such situations.

Execution Strategies in Trading

Understanding Fair Value Gaps

The speaker discusses the concept of "inversion fair value gaps," indicating that these gaps can provide opportunities for partial executions during trading.

Emphasizes the importance of identifying midpoints or consequent encroachments within gaps, particularly when entering trades based on previous price movements.

Highlights the necessity of placing stop-loss orders above key levels to manage risk effectively while engaging with fair value gaps.

Price Action and Market Behavior

The speaker expresses a desire to see price action support move downward, indicating a strategy focused on targeting specific lows and imbalances in the market.

Discusses how large wicks in price action can signal potential partial exits, reinforcing the idea of mapping out price movements without self-criticism.

Execution Techniques and Risk Management

Mentions using various execution points as part of a broader strategy, suggesting that traders should enjoy the process rather than be overly critical of their decisions.

Talks about rolling stock prices to cover costs and emphasizes speed in executing trades once certain thresholds are met.

Learning Through Practice

Stresses the importance of practice and experimentation for developing trading skills, encouraging students to annotate and screenshot their strategies regularly.

Asserts that understanding price action requires a foundational knowledge base, urging traders not to react but rather predict market movements actively.

Community Dynamics and Personal Frustrations

Shares frustrations regarding communication within mentorship groups, emphasizing the need for discipline among students during live sessions.

Live Trading Session Insights

Frustration During Live Streaming

The speaker expresses frustration about distractions during a live stream, emphasizing the importance of focus while teaching. They mention feeling "fuming" due to interruptions from others in the room.

Analyzing Market Levels

The speaker counts down their trading tasks and discusses analyzing market levels, specifically referencing "relative equal lows." They transition to examining a 15-minute chart for better insights into market behavior.

Identifying Key Trading Levels

Key trading levels are identified: rejection block at 19894 A5, consequent encroachment at 19877 A5, and a 15-minute low at 19860 even. These notes are made on a notepad for clarity and reference.

Volume Imbalance Considerations

Discussion includes volume imbalance as an important factor in trading decisions. The speaker highlights its potential use for short exercises and emphasizes understanding market dynamics through practice.

Embracing Trading Practice

Trading Strategies and Insights

Engaging with Short Time Frames

The speaker emphasizes the importance of making independent trading decisions, encouraging listeners to engage actively in their trading practice.

A one-minute chart is recommended as the highest time frame for trading, providing numerous opportunities. The 15-second chart offers even more chances due to increased price delivery and formation of fair value gaps.

The speaker describes short-term liquidity pools and market structures that can be utilized for practice, likening it to a laboratory experiment for traders.

Analyzing past trades helps identify which were most successful or aligned with market movements, emphasizing the need for self-assessment in trading performance.

Understanding Market Dynamics

Discussion on weekly buy/sell signals highlights the significance of understanding volatility and market behavior during trades.

The concept of "pinball" trading is introduced, where traders buy and sell using every fair value gap formed on shorter charts while targeting old highs or lows.

The speaker encourages traders to measure their progress over time by aiming for relative equal highs and analyzing price delivery patterns.

Addressing Community Engagement

The speaker reflects on interactions with critics online, suggesting that some detractors may not genuinely dislike him but rather enjoy provoking reactions.

Confidence in his teaching ability is expressed through references to successful students worldwide who have benefited from his mentorship.

Risk Management Considerations

Concerns are raised about followers risking money based on his strategies; he expresses nervousness about others emulating his trades without proper risk assessment.

Emphasizes the difference between personal risk tolerance and that of students; he aims to protect them from taking excessive risks based on his live demonstrations.

Trading Philosophy

The speaker discusses how emotional detachment aids in effective trading when alone versus under scrutiny from an audience.

Emotional Dynamics in Trading

The Impact of Emotions on Trading Decisions

The speaker describes a conflicting emotional state while trading, feeling detached and "blanked out" when executing trades but becoming emotionally invested due to the responsibility towards students risking real money.

There is a shift in focus from personal trading strategies to ensuring that students are making informed decisions during market fluctuations, highlighting the importance of mentorship.

Understanding Fair Value Gaps

Discussion on fair value gaps emphasizes their role in price movement; specifically, how prices can react to these gaps based on previous models and patterns observed.

The speaker explains the concept of an inversion fair value gap, detailing how it should behave during trades and what traders should look for regarding price action.

Risk Management Strategies

Importance of setting stop-loss orders is discussed, with emphasis on allowing some leeway for market movements while maintaining control over risk exposure.

The speaker shares insights from live trading sessions using a 15-second chart, demonstrating practical applications of strategies even under low probability conditions.

Learning and Progression in Trading Skills

Encouragement for students to practice consistently with demo accounts is emphasized as essential for skill development over time; notable progress can be expected within months.

A strong recommendation against using market orders unless absolutely necessary; limit orders are preferred to avoid impulsive decisions driven by emotions.

Community Engagement and Self-Learning

The speaker stresses the importance of active participation in learning rather than passively consuming content; engagement is crucial for mastering trading skills.

Trading Insights and Strategies

Authenticity in Trading

The speaker emphasizes the importance of authenticity, stating they have never edited content to appear better. They encourage viewers to either find value in their teachings or seek alternatives.

Risk Management and Execution

The speaker discusses the potential benefits of linking accounts to trade copying services, expressing a willingness to take risks for short-term gains despite possible job repercussions.

They highlight that many traders using high leverage lack understanding, leading to significant losses. Proper risk management is essential for sustainable trading success.

Influencer Critique

The speaker criticizes influencers who reset their accounts frequently due to poor trading skills, contrasting this with their own teaching approach focused on consistent profit without resets.

They advocate for starting small with one contract and gradually increasing exposure as confidence and capital grow, emphasizing proper risk management over chasing large payouts.

Mindset and Market Understanding

The speaker warns against the mindset of seeking big wins, which can lead to unsustainable trading habits. Instead, they promote steady progress over time.

Acknowledging criticisms of another trader (ICT), the speaker praises their live execution skills and ability to predict market movements effectively compared to others who react rather than anticipate.

Anticipation vs. Reaction

The importance of anticipating market movements rather than merely reacting is stressed. Being proactive allows traders to maintain an advantageous position in the market.

The speaker argues that reacting places traders at a disadvantage, always following those ahead in the market instead of leading with informed decisions.

Practical Trading Techniques

They discuss utilizing specific tools like fair value gaps and order blocks while practicing price action exercises. Engaging with various setups helps develop a trader's eye for opportunities.

Emphasizing practice, the speaker reassures beginners that discomfort is normal when learning trading techniques but encourages persistence through daily executions for skill development.

Learning from Experience

The necessity of investing time into practice is highlighted; even 10–20 trades per day can significantly enhance one's understanding of market dynamics over time.

Understanding Profitable Trading

Key Concepts of Market Timing and Risk Management

Profitable trading hinges on accurately predicting market movements at optimal times, identifying high-probability retracement levels without exceeding them to effectively use stop-loss orders.

The speaker emphasizes the importance of understanding when a trade is low probability as a precursor to recognizing high probability trades, which is crucial for mentorship sessions.

Initial mentorship sessions focus on identifying high resistance liquidity profiles and problematic conditions in the market, which some participants may dismiss prematurely.

Challenges Faced by Traders

Many traders who quit early often do not return or fail to succeed due to unrealistic expectations of immediate profits and a lack of patience in learning.

The speaker expresses frustration towards those who demand instant results, asserting that he does not owe anyone quick profits or signals.

Teaching Philosophy and Methodology

The speaker clarifies his role as an educator rather than a financial advisor, emphasizing the importance of teaching price action concepts through real-time examples rather than providing direct trading signals.

He uses demo accounts for teaching purposes to avoid liability while ensuring that students engage with live data during their learning process.

Confidence in Trading Skills

The speaker conveys confidence in his trading abilities and encourages students to develop similar confidence through practice and experience.

Students who master these skills will be able to defend their knowledge confidently against skeptics, showcasing their competence in trading.

Engaging with Real-Time Price Action

The concept of "volatility pinball" is introduced as an exercise for engaging with various price dynamics without feeling pressured into specific strategies too soon.

Forex Trading Insights and Critiques

The Reality of Forex Trading

The speaker emphasizes the importance of real-time trading logic, asserting that their live executions cannot be faked, contrasting it with other traders who may present misleading information.

A warning is issued against Forex traders who have no interest in Futures trading, suggesting they might be operating under deceptive conditions with unreliable brokers.

The speaker criticizes those who seek validation from popular figures in Forex trading, labeling them as undeserving of admiration and cautioning against idolizing such individuals.

Deception in the Industry

There is a strong condemnation of traders who manipulate perceptions for profit, claiming they mislead followers by showcasing unrealistic financial gains.

The speaker argues that true success in trading cannot be achieved through manipulated platforms like MT4 and challenges others to prove their claims under genuine market conditions.

Personal Integrity and Transparency

The speaker asserts their credibility by highlighting their high viewership and retention rates during live streams while providing free educational content without seeking payment.

They express frustration over repeated requests for paid mentorship, clarifying that all necessary education has been made available for free on their YouTube channel since 2016.

Financial Independence

Emphasizing personal wealth, the speaker states they do not require money from followers or students to sustain themselves, reinforcing their commitment to providing free education.

They assert that they can generate income independently through trading strategies rather than relying on external funding or mentorship fees.

Challenging Competitors

The speaker questions the integrity of competitors who sell courses at inflated prices while failing to provide transparent evidence of their success compared to the speaker's open approach.

Competition and Challenges in Trading

The Motivation Behind the Competition

The speaker expresses regret about causing pain but emphasizes a desire for competition, specifically mentioning a challenge in the "Robins" trading cup.

They highlight their efforts to provoke other traders into participating, noting that many are hesitant due to existing mentorships and services they offer.

The speaker claims to have thick skin and is willing to risk their reputation to draw out competitors for a public showdown.

Frustration with Competitors

There’s frustration expressed over competitors' reluctance to engage, suggesting they fear losing their financial security tied to mentorship programs.

The speaker insists that every trade made during the competition was purely mechanical, emphasizing a lack of emotional involvement or strategy behind it.

Call for Engagement

A challenge is issued directly to prominent figures in trading, asserting readiness and confidence despite current standings.

The speaker reflects on wanting to be pushed and challenged at their lowest point, indicating a belief in personal resilience.

Accountability and Verification

They express disappointment over competitors not stepping up as promised, questioning their integrity and commitment.

The speaker mentions potential verification from an external source (Joe Robbins), reinforcing transparency in the competition's results.

Future Aspirations

A bold claim is made about returning stronger than before with minimal resources, aiming for an upset victory against established traders.

Understanding the Motivation Behind Trading Strategies

The Importance of Reputation and Fun in Trading

The speaker emphasizes that their primary motivation for trading is not reputation but rather fun and entertainment, despite being labeled a demo trader.

They express confidence in their abilities, stating they wouldn't be live streaming if they couldn't perform well, highlighting their enjoyment in engaging with critics on social media.

The speaker challenges the audience's perception of success by questioning the difficulty of achieving significant returns (e.g., 400%), asserting that it is relatively easy to do so.

Addressing Criticism and Evidence

Acknowledging potential skepticism from viewers, the speaker points out that many will ignore evidence presented during live streams due to preconceived notions or trolling behavior.

They assert control over their trading methods and emphasize teaching effective strategies in real-time, showcasing a commitment to transparency and education.

Competition and Community Engagement

The speaker expresses a desire for competition within the trading community, indicating that they welcome challengers who are willing to engage seriously.

They reflect on past experiences where competitors did not step up, suggesting that this lack of engagement diminishes opportunities for growth and learning within the community.

Perceptions of Success and Failure

The speaker critiques those who view winning competitions as definitive proof of skill, arguing that true understanding comes from practical experience rather than accolades.

They encourage viewers to recognize the value of live demonstrations over trophies, emphasizing ongoing learning through real market interactions.

Embracing Challenges and Personal Growth

The speaker shares their intention to participate in competitions like Robin's Cup but insists on doing it on their own terms without compromising personal integrity or approach.

Understanding Trading and Investing Mindset

The Importance of Direct Learning in Trading

The speaker emphasizes the value of direct learning in trading and investing, aiming to simplify the decision-making process for others based on their own experiences.

They assert that if educators are not willing to publicly share their insights and methodologies, they may not be worth following or paying for.

The speaker critiques marketing tactics used by some influencers, suggesting that genuine knowledge should not rely on drama or hype.

Building Independence as a Trader

A key mindset discussed is independence; traders should aim to learn how to make decisions without relying heavily on mentors or influencers.

The speaker encourages aspiring traders to develop confidence in their abilities, indicating that true success comes from self-sufficiency rather than dependency on guidance.

Mentorship and Personal Growth

Reflecting on personal mentorship experiences, the speaker highlights the importance of critical thinking over rote learning from mentors.

They acknowledge a mentor's influence while also stressing the need for individual interpretation and application of trading strategies.

Challenging Conventional Wisdom

The speaker disputes common beliefs about market randomness, arguing against the notion that price movements are solely driven by buying and selling pressure.