85.

Entry Techniques and Stop Loss Placement

Overview of Entry Techniques

• The session focuses on entry techniques for trading, specifically discussing two methods to enter trades and how to place stop losses.

• A recap is provided on previous lessons, emphasizing the importance of identifying market structure through low, lower low, and higher low patterns.

Key Levels and Liquidity

• Traders should identify key levels in both discount and premium zones; a significant fair value gap is noted above the first key level.

• When price reaches a key level, traders are advised to drop down two time frames to analyze lower lows, higher highs, and changes in delivery state.

Trade Execution Strategy

• The speaker emphasizes that while these techniques can improve entry accuracy, they do not guarantee 100% success rates.

• During periods of accumulation (up-down movements), traders should look for liquidity sweeps before entering trades based on order blocks.

Analyzing Candlestick Patterns

• Focus on identifying low volume candles within clusters; these can indicate potential trade entries when zoomed out to higher time frames.

• A specific example illustrates a trade that took 20 hours but resulted in a favorable 5:1 risk-to-reward ratio.

Higher Time Frame Analysis

• The concept of "zooming out" is introduced as a method for clarifying unclear signals on lower time frames by analyzing higher time frame structures.

Understanding SMT Divergence and Entry Techniques

Key Concepts of SMT Divergence

• The discussion begins with the concept of a double bottom pattern, highlighting the importance of higher lows on the S&P when divergence occurs at key levels.

• The speaker emphasizes placing stop losses above significant highs to ensure safety in trading decisions.

Utilizing the Trigger Indicator

• An indicator called "the trigger" was developed to identify important highs and lows effectively; users are encouraged to experiment with its settings.

• It is advised not to act on every signal (red or green dots), but rather focus on those that align with marked key levels for better accuracy.

Confirmation and Strategy

• All entry techniques and stop-loss placements should be confirmed with SMT divergence, reinforcing the need for thorough analysis before executing trades.

• The session aims to consolidate knowledge from previous weeks, providing a comprehensive model for backtesting trades.

Correlation Across Assets

• Divergence strategies can be applied across various assets; specifically mentioned is using the Euro's inverse correlation with DXY for effective trading.

• The speaker reiterates that patterns like double tops and bottoms remain consistent across different asset classes.

Focused Trading Approach

• A clear directive is given regarding focusing on major cryptocurrencies like Bitcoin and Ethereum, dismissing less known assets as irrelevant without proper correlation.

• Emphasis is placed on understanding market movements; traders should have sufficient chart time to anticipate market dumps effectively.

Future Expectations and Support Structure

• Predictions are made about upcoming market movements, indicating potential highs within a specified timeframe based on prior discussions.