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ICT Mentorship 2023 - July 23, 2023 Market Review
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ICT Mentorship 2023 - July 23, 2023 Market Review

Market Review: Dollar Index, Euro Dollar, and Futures Analysis

Overview of the Dollar Index

  • The discussion begins with a market review focusing on the Dollar Index, Euro Dollar, S&P, and NASDAQ futures.
  • The speaker notes that the Dollar Index was close to a significant price point but fell just short by one pipette.
  • Attention is drawn to specific price points in relation to sell-side imbalances and buy-side inefficiencies within the market.

Daily Chart Insights

  • A liquidity void is identified between two candles where no trading occurred; this gap may influence future pricing behavior.
  • The speaker emphasizes the importance of monitoring how prices interact with this gap as it could remain open for an extended period.

Weekly Volume Imbalance in Euro Dollar

  • The weekly volume imbalance is discussed, highlighting a lack of candlestick body between two respective candles indicating potential inefficiency.
  • This inefficiency suggests that algorithms will refer back to this timeframe for efficient delivery of trades.

Price Behavior and Market Expectations

  • The analysis indicates that recent trading has fulfilled expectations regarding liquidity drawdowns observed over several months.
  • A recap of trading activity shows movement from high to low within the established volume imbalance range.

Future Trading Considerations

  • The speaker reflects on previous analyses and targets set in July, noting successful predictions about price movements.
  • Emphasis is placed on understanding current market conditions without needing immediate predictions about future moves; both upward and downward movements are possible.

Intraday Trading Strategy

  • It’s suggested that traders should focus on intraday sessions (London Open Session, New York Open Session), given current uncertainties in market direction.
  • Key areas of interest include premium and discount zones related to inefficiencies identified earlier in the analysis.

Closing Thoughts on Market Dynamics

  • Observations from hourly charts indicate support levels at weekly volume imbalances while also recognizing potential inefficiencies above and below these levels.

Market Analysis and Predictions

Overview of Recent Market Movements

  • The speaker discusses the recent trade movements, highlighting a foreign gap that was outlined previously. They note an interest in the weekly chart for NASDAQ, indicating it likely points to an upside draw.
  • The speaker expresses caution about calling market tops but suggests a reasonable expectation for a pullback into identified inefficiencies within the S&P 500.
  • Emphasis is placed on closing prices; if the down closed candle's low is breached on a weekly basis, it may indicate an intermediate-term high for both S&P and NASDAQ.

Current Market Sentiment

  • Despite potential signs of reaching a high, the overall sentiment remains bullish. The speaker notes no current indicators suggest a definitive market top.
  • An immediate rebalance is observed in the daily chart of S&P, with expectations for price action to potentially retrace into inefficiencies without altering long-term bullish trends.

Technical Analysis Insights

  • A swing low has been established with trailing stop losses positioned below it. There’s mention of inefficiency between specific candle highs and lows that could allow for further trading without disrupting bullish momentum.
  • If prices close above Friday's high, this would alter the current analysis; however, there are expectations for movement towards lower sell-side liquidity pools.

Anticipated Price Movements

  • The speaker anticipates trading down into order blocks and inefficiencies while remaining cautious about potential gaps at market openings.
  • Various scenarios are considered as they prepare for Sunday’s opening price action leading into Monday's trading session.

Weekly Trading Strategy

  • The focus shifts to identifying buy-side or sell-side liquidity draws during intraday trades without holding any bias on higher time frames.
  • Observations from previous week’s trading show aggressive rallies followed by significant drops targeting sell-side liquidity within balanced price ranges.

Conclusion on Liquidity Pools

  • The discussion highlights how certain volume imbalances create balanced price ranges which influence future market behavior.
  • There's anticipation of probing lower sell-side liquidity pools unless significant upward movement occurs above recent highs.

Market Analysis and Trading Strategy

Current Market Structure and Expectations

  • The speaker discusses the existing market structure, indicating a short-term premium that leads into a fair value gap and breaker. They express a desire to see a gap lower to fill this area.
  • Emphasizing caution, the speaker advises against making trades based on their analysis, suggesting that observers should wait for clearer signals before acting.

Trading Approach for the Upcoming Week

  • The speaker plans to refrain from trading until Tuesday, using Monday's activity as a foundation for understanding potential weekly candlestick movements.
  • They clarify their current mindset is focused on intraday trading only, without any daily bias, which necessitates attention to intraday volatility and liquidity opportunities.
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.