78. Price action lecture

Market Analysis and Upcoming Events

Overview of Current Market Conditions

• The speaker reflects on the weekend, noting a lack of high-probability trading opportunities over the past two to three weeks.

• Emphasizes that low probability weeks typically yield only two to three entries across all platforms, indicating a stagnant market.

• Suggests that current market conditions may be intentionally designed to frustrate traders and induce losses.

Importance of Scheduled Releases

• Mentions using forexfactory.com for tracking scheduled release dates and liquidity injections into the market.

• Highlights that the true week open occurred 23 minutes prior, stressing its significance in trading strategies.

Upcoming News Events

• Notes upcoming news events on Tuesday at 10 a.m. and anticipates more volatility on Friday due to NFP (Non-Farm Payroll).

• Observes an unusual number of red news folders this week, suggesting potential market movement.

Understanding Market Cycles

• Introduces the concept of "Joker week," where price action tends to be less predictable; relates it to doubling theory.

• Discusses how certain weeks are more favorable for trading based on historical patterns, particularly emphasizing Q2-Q4 dynamics.

Anticipated Volatility and Price Action

• Predicts significant reversals during Wednesday's news events while expressing skepticism about Tuesday's movements being impactful.

• Indicates that Thursday will likely mirror Tuesday's behavior with limited volatility expected until Friday.

Liquidity Gaps and Market Behavior

Analyzing Price Action

• Refers to previous discussions about gaps in price action; suggests breaking above these gaps could lead to new highs.

• Stresses the importance of liquidity draws in understanding market movements; notes current price action lacks clarity.

Consolidation Patterns

• Describes recent consolidation within the US dollar index, indicating a lack of strong directional movement over the past week.

• Warns against expecting reversals when observing expanding index futures markets alongside consolidating dollar prices.

Final Thoughts on Market Dynamics

Market Analysis and Price Action Insights

Understanding Price Movements and Correlations

• The discussion begins with the observation of a price drop below a significant gap in the US dollar, indicating potential upward movement based on this correlation.

• It is noted that current market conditions may not exhibit symmetrical price action, leading to divergent movements among Bitcoin, Euro, and other asset classes.

• The speaker emphasizes that low probability price actions occur when different assets move in opposite directions instead of synchronously.

Key Levels and Cracking Correlation

• A critical low from the previous week is highlighted; if prices fall below this level, it could indicate a cracking correlation that might influence future price movements.

• The concept of sequential Smart Money Technique (SMT) is introduced as an important factor for interpreting difficult price actions.

Monthly Liquidity Levels

• Index futures are identified as easier to read currently; key liquidity levels are established by analyzing monthly highs and lows according to doubling theory.

• Doubling Theory allows traders to identify potential monthly high runs while observing failure swings in related assets for further insights into market behavior.

Comparative Analysis of Indices

• A comparison between Dow Jones, NASDAQ, and S&P 500 reveals differing compressions in price action; understanding these differences can inform trading strategies.

• The analysis suggests that prices may run below certain lows before returning within established ranges, indicating possible sequential SMT formations.

Market Sentiment and Trading Signals

• There’s a critique of individuals seeking simple signals without understanding the underlying concepts; the speaker expresses frustration over misappropriation of their insights by others online.

• Despite frustrations with sharing charts directly due to misuse by others, there’s an indication that more accessible content may be provided in the future.

Anticipating Future Price Movements

• As the quarter progresses into its 13th week, clearer pricing patterns emerge; expectations are set for potential liquidity draws before higher prices are realized.

• The speaker anticipates one index will likely take out its low before moving higher again based on observed market behaviors.

Market Analysis and Price Action Insights

Overview of Current Market Behavior

• The market exhibited low probability price action today, indicating a potential shift towards high probability price action in the near future.

• Discussion on the significance of today's high as it relates to the current cycle, particularly focusing on Q2 and Q3 movements.

• Mention of sequential SMT (Smart Money Technique) patterns that could influence price movement throughout the week.

Price Movement Expectations

• If a bullish sequence SMT occurs, it may lead to higher prices; however, if one is not established by Thursday, earlier signals may be deemed unreliable.

• Emphasis on identifying clear ranges within specific asset classes for better trading decisions this week.

Bitcoin's Price Dynamics

• Observations on Bitcoin's slow movement towards recent highs, characterized by choppy price action typical near all-time highs.