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Deep Learning On Nasdaq Futures Trade - January 04, 2023
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Deep Learning On Nasdaq Futures Trade - January 04, 2023

NASDAQ 100 Futures Analysis for March 2023

Overview of Current Market Conditions

  • The discussion focuses on the NASDAQ 100 Futures contract for March delivery in 2023, analyzing daily chart patterns and volume balance.
  • Anticipation of price movement towards a specific level based on previous trading sessions, particularly around the opening and closing prices.

Volume Balance Insights

  • Emphasis on price action characterized by wicks rather than bodies, indicating significant levels that algorithms may reference for trading decisions.
  • Acknowledgment of upcoming Forex commentary while maintaining focus on NASDAQ futures and S&P futures analysis.

Trading Strategy During Non-Farm Payroll Weeks

  • Recommendation to concentrate trading efforts from Monday to Wednesday before the New York session during non-farm payroll weeks due to market volatility.
  • Explanation of typical market behavior leading up to employment numbers release, suggesting reduced precision in trades post-New York session on Wednesdays.

Precision in Trading Analysis

  • Discussion about the importance of high accuracy in identifying trade setups despite potential choppiness during certain periods.
  • Insight into personal trading experiences shared as educational examples for students, highlighting elements that contribute to successful trades.

Key Levels and Market Dynamics

  • Identification of critical price levels that traders should monitor; emphasis on algorithmic price delivery beyond average retail analysis concepts.
  • Examination of fractal lows within price action as indicators for potential upward movements toward relative equal highs.

Accessibility for Global Traders

  • Clarification that non-U.S. traders can still engage with U.S. markets through equivalent instruments like U.S. 100 contracts despite restrictions on direct futures contracts.

Understanding Trading Platforms and Data

Choosing the Right Broker and Platform

  • The symbol for trading S&P 500 on MT4 or non-US brokers is US 500. Users can compare this on TradingView.
  • Real-time data is essential for trading; it's affordable through TradingView, which the speaker personally recommends without any affiliate ties.

Accessing Market Data

  • U.S. traders are generally restricted from trading certain CFDs like US 100 and US 500; instead, they should focus on Futures Contracts that require real-time exchange data at a low cost (approximately $5/month).

Analyzing Price Movements

  • The discussion emphasizes analyzing relative equal highs and net volume on hourly charts to establish a framework for understanding price movements.
  • A focus on specific areas of imbalance in price movement is encouraged, with an emphasis on personal chart analysis rather than solely relying on provided charts.

Setting Up Your Charts Correctly

Time Zone Settings

  • It's crucial to set TradingView charts to New York time to align with the speaker's references during analysis.

Key Price Levels

  • The speaker identifies significant price levels based on historical candle movements, specifically anchoring around a high of one zero eight six four point seven five.

Diverse Trading Models

Flexibility in Trading Strategies

  • The speaker highlights their versatility beyond the mentorship model taught in 2022, indicating multiple trading models available for use.

Student Engagement with Concepts

  • Students are encouraged to explore various concepts and find what resonates most with their individual trading style.

Real-Time Data Analysis

Replay of Market Movements

  • A quick replay of market executions will be shown, compressing lengthy sessions into shorter segments for easier understanding.

Importance of Patience in Trading

  • Emphasizes that even fast-paced one-minute charts require patience as each candle must close before another begins.

Content Sharing and Copyright Concerns

Protecting Intellectual Property

  • The speaker discusses measures taken to prevent unauthorized sharing of their content, including watermarking videos to maintain ownership rights.

Clarifying Intentions Behind Content Creation

Understanding Market Movements and Live Trading

Real-Time Analysis During Live Sessions

  • The speaker emphasizes the importance of anticipating market movements while observing one-minute and five-minute candles in real-time during live sessions starting February 7th.
  • Witnesses will be present during these sessions to validate the analysis, addressing public skepticism about the effectiveness of the strategies being taught.
  • The speaker clarifies that they will not execute trades live but will guide participants on market direction and comment on price actions instead.

Trade Execution Insights

  • During live walkthroughs, the speaker plans to provide commentary similar to what participants can expect in real-time trading scenarios.
  • Acknowledges a small portion of market movement left open for potential revisit, indicating ongoing opportunities for traders.
  • Discusses trading down into an order block with subsequent consolidation before entering a critical time window (10:30 - 11:00 AM).

Liquidity and Market Structure

  • Notes are kept to illustrate real-time chart annotations while executing trades, highlighting areas of buy/sell liquidity above relative equal highs.
  • Traders often misinterpret resistance levels; despite lower prices initially expected, there is potential for upward movement towards daily volume imbalances identified earlier.

Non-Farm Payroll Week Considerations

  • Mentions that during non-farm payroll week, price delivery may be less precise due to increased volatility and uncertainty in market behavior.
  • Encourages studying real-time data using indices like US-100 as a learning tool without needing constant access to live data feeds.

Understanding Market Dynamics

  • The speaker discusses their analytical approach using various indices (US 100, US 500, US 30), emphasizing their utility for understanding market dynamics rather than direct trading.
  • Highlights expectations for upward movement towards volume imbalances if certain conditions are met within the market structure.

Fair Value Gaps and Market Shifts

  • Explains how markets can dive into fair value gaps before rallying back up; this concept is crucial for understanding price action dynamics.
  • Reassures participants that with practice and exposure to these concepts, they will become more intuitive over time—encouraging persistence in learning.

Order Blocks and Price Action Management

  • Describes trading down into an order block followed by a rally; emphasizes recognizing shifts in market structure even when prices appear discounted.

Understanding Market Indicators and Analysis

The Secret Indicator for Hedge Fund Traders

  • A unique market indicator is utilized by elite hedge fund traders and foreign market makers, which can be difficult to believe but is crucial for understanding market movements.

Using Trading View for Comparisons

  • To compare different instruments in Trading View, use the compare utility (indicated by a plus symbol) to overlay ES H2023 on your current chart. This allows for better analysis of market trends.

Analyzing NASDAQ vs. E-mini S&P

  • Non-US students can utilize US-100 in Trading View to analyze NASDAQ performance against other indices. It's important to pause the video if needed to follow along with these steps.

Charting Techniques and Observations

  • When analyzing charts, drop vertical lines at key points to identify matching highs and lows between NASDAQ (NQ) and E-mini S&P (ES). This helps visualize relative strength differences.

Relative Strength Analysis Insights

  • The analysis shows that NASDAQ futures exhibit stronger buying potential compared to E-mini S&P due to more pronounced short-term highs, indicating a preference for trading in the NASDAQ market.

Fair Value Gaps Explained

  • Fair value gaps are categorized based on candle movement: upward movements create buy-side imbalances while downward movements create sell-side imbalances. Understanding this distinction aids in trading strategies.

Market Behavior Predictions

Understanding Fair Value Gaps and Market Dynamics

The Concept of Fair Value Gaps

  • The speaker discusses the challenges in precision during FOMC and non-farm payroll weeks, highlighting a potential for creating an institutional order entry drill into a fair value gap.
  • It is emphasized that this entry model represents only a partial movement into the fair value gap, which does not fully close it but allows high-frequency trading algorithms to capitalize on small movements.

Measuring Gaps and Market Behavior

  • A measuring gap is identified as the market creates support, with reference to specific price points that indicate potential rallying areas.
  • The speaker explains how to target exits based on confirmation that certain price levels will not be filled, using previous examples to illustrate this method.

Real-Time Identification of Gaps

  • The discussion highlights the lack of real-time identification techniques for measuring gaps in traditional education, contrasting it with hindsight analysis often found in books and courses.
  • Emphasis is placed on understanding when gaps are likely to remain open or get filled, particularly in electronic markets where traditional concepts may not apply.

Liquidity Voids vs. Imbalances

  • The speaker clarifies misconceptions about liquidity voids, explaining them as areas of imbalance rather than true voids where no trading occurs.
  • Definitions are provided for buy-side imbalances and sell-side inefficiencies, illustrating how these concepts relate to market behavior and algorithmic trading strategies.

Advanced Technical Analysis Techniques

  • The speaker shares personal insights on identifying gaps without relying solely on established educators' terminology while aiming for deeper understanding.
  • A focus on advanced technical analysis is noted, encouraging learners to develop their own insights into market opportunities through real-time data observation.

Practical Application and Learning Strategy

  • Learners are encouraged to wait for specific times of day and look for trade signatures that justify their trades based on observed patterns over time.
  • Recordings of live sessions will be available for learners to review setups repeatedly; however, they may be lengthy due to comprehensive coverage of each session's content.

Market Analysis and Trading Strategies

Overview of Market Behavior

  • The speaker discusses a pivotal moment in trading where a specific price level was identified as crucial. If the market crossed this line, it would trigger a stop-loss order.
  • Emphasizes that trading during FOMC events is risky, comparing it to a "carnival ride." The speaker aims to guide traders towards finding high-probability setups rather than overwhelming them with information.

Educational Approach

  • The speaker addresses criticism regarding their teaching methods, asserting they are focused on educating traders rather than competing with others in the field.
  • Highlights the importance of understanding market control and encourages viewers to observe live charts for practical learning.

Trade Management Insights

  • Transitioning into trade management, the speaker prepares to demonstrate how trades were executed based on prior analysis.
  • Clarifies that risk management is essential; mentions using a paper trading account for demonstration purposes while ensuring real-time data accuracy.

Market Dynamics and Liquidity

  • Discusses market maker buy models and introduces concepts from their "Scout Sniper" series available on YouTube for further learning.
  • Describes waiting for price movements away from an order block, indicating areas of potential liquidity.

Risk Control Techniques

  • The speaker emphasizes moving stops to break even after reaching certain price levels to manage risk effectively.
  • Mentions observing daily volume imbalances and adjusting positions accordingly as new gaps form in the market.

Algorithmic Trading Concepts

  • Introduces algorithmic principles behind price movement, distinguishing them from traditional support/resistance or supply/demand strategies.
  • Acknowledges complexity but reassures viewers that understanding these algorithms can lead to better trading outcomes over time.

Anticipating Market Moves

  • Outlines expectations for future liquidity targets based on current market behavior and previous analysis.

Understanding Price Action and Trading Strategies

The Superiority of Naked Charts

  • The speaker emphasizes the importance of naked charts over indicator-based analysis, arguing that without a time-based chart, traders miss critical elements like fair value gaps and volume imbalances.
  • The speaker dismisses alternative chart types (e.g., range bars, Heikin Ashi) as ineffective, stating that algorithms do not respect these formats.

Analyzing Price Movements

  • The focus is on identifying price return patterns; recognizing repeating phenomena can help traders trust certain setups while remaining cautious about others.
  • Anticipation of price movement is discussed, with expectations for bullish trends as long as prices stay above specific shaded areas.

Candlestick Patterns and Market Psychology

  • Observations are made regarding the transition from large green candles to smaller range candles, suggesting an upcoming shift back to larger bullish candles.
  • The speaker details their strategy for entering trades with a significant position size (10 contracts), aiming for substantial price movements (600 ticks).

Framework for Analysis

  • A rejection block is identified as a target area for price movement; the speaker encourages annotating charts during analysis to highlight logical levels.
  • Discussion includes classic bull flag patterns and how retail traders might react by placing stop losses below swing lows.

Institutional Order Flow Insights

  • The algorithm's behavior around bull flags is explained; retail traders often get stopped out due to market manipulation before potential upward movements occur.
  • Speculation on institutional order flow suggests that minor dips may present opportunities for additional entries into long positions.

Timing and Market Conditions

  • Real-time trading insights are shared, highlighting challenges during specific market sessions (e.g., post-New York session).

Understanding Trading Strategies and Market Dynamics

Observations on Market Behavior

  • The speaker highlights the position of their mouse over the buy button, indicating readiness to execute a trade.
  • Attention is drawn to a specific price level that may be significant for trading decisions, described as possibly yellow but uncertain in color.
  • An order block is identified near a down candle, with the speaker placing a limit order at the bottom of daily volume balance for potential bullish movement.

Technical Analysis Insights

  • The speaker reflects on their experience with chart analysis and acknowledges challenges due to age-related vision issues.
  • A reclaimed order block is explained as an area that can act as support after being previously breached; this behavior is normal in market dynamics.
  • The importance of annotations in charts is discussed, emphasizing how they can distract from real-time price observation during live sessions.

Trading Philosophy and Approach

  • The speaker addresses viewer complaints about video length while stressing the necessity of detailed explanations for effective learning.
  • Emphasis is placed on the primary goal of trading: making money rather than treating it as a hobby or game.
  • Anticipation of price reaching a rejection block leads to plans for selling contracts, showcasing strategic thinking in trading.

Execution and Real-Time Decision Making

  • The process of documenting trades (e.g., selling two contracts) is shared to clarify actions taken during live trading scenarios.
  • Clarification that actions shown are not added post-factum; instead, they reflect real-time decision-making processes during trades.

Challenges in Trading Environments

  • Discussion about waiting longer due to typing out trade instructions illustrates internal dialogue affecting execution timing.
  • Acknowledgment that some days are "sloppy" presents challenges for traders; understanding these conditions helps prepare them mentally for market fluctuations.

Understanding Trading Dynamics

The Importance of Patience in Trading

  • Emphasizes that trading requires patience and careful observation of price action, highlighting the absence of shortcuts for profitable trading.
  • Notes the necessity of a clear chart for learning purposes, despite personal preferences for less cluttered visuals.

Technical Challenges and Audio Quality

  • Acknowledges issues with audio quality due to new office acoustics, indicating improvements will come with more content production.
  • Discusses the limitations of recording environments, including challenges faced while using high-quality microphones in less-than-ideal settings.

Analyzing Market Movements

  • Introduces a "measuring gap" concept as an indicator for potential institutional order flow, suggesting cautious buying strategies.
  • Mentions taking partial profits by removing two contracts from a position while waiting for further upward movement.

Resistance Levels and Market Psychology

  • Advises against viewing certain price levels as resistance; instead, these should be seen as temporary pauses before market expansion.
  • Reflects on past trading strategies that misinterpret market signals, emphasizing the need to align with algorithmic perspectives.

Trade Management Strategies

  • Describes adjusting contract positions based on market behavior and aiming for larger candle formations to maximize profit potential.
  • Details a methodical approach to scaling out of trades by monitoring liquidity levels and making incremental adjustments rather than executing large orders at once.

Final Thoughts on Execution and Liquidity Pools

  • Highlights the importance of being strategic about trade exits while remaining aware of buy stops above key levels targeted by algorithms.

Trading Strategy Insights and Execution

Understanding Trade Execution and Risk Management

  • The speaker discusses the importance of making bold moves in trading, particularly aiming for a significant price increase above recent highs while managing equity by peeling off contracts as profits are realized.
  • Emphasizes a strategic mindset where the trader is unconcerned about potential stop-loss triggers, having already secured profits from logical entry points along the way.
  • Mentions sharing real-time trade updates on social media platforms to maintain transparency and combat misrepresentation by others who might claim credit for his trades.
  • Expresses frustration over others taking credit for his work without proper attribution, highlighting the importance of integrity within the trading community.
  • Reflects on missed opportunities to take partial profits at critical levels, indicating a desire to balance between securing gains and holding out for larger targets.

Analyzing Market Conditions and Personal Trading Style

  • The speaker notes adjustments in their trading approach due to market conditions, acknowledging that they typically prefer cleaner trades rather than those characterized by slow movements.
  • Discusses the scale of trades being executed, contrasting small incremental gains with larger multi-hundred tick trades indicative of high-level trading strategies.
  • Identifies daily volume imbalances as key indicators for setting final targets in trades, reinforcing the need for strategic planning based on market data.
  • Shares insights into personal discomfort with late-week trading during specific economic events (like FOMC), which can lead to less predictable market behavior.
  • Highlights internal conflict regarding whether to exit positions early or hold out longer based on perceived market dynamics and personal trading philosophy.

Position Management Techniques

  • Describes an intention to manage risk effectively by considering trailing stop losses as part of position management strategy when nearing target levels.
  • Explains how internal dialogue influences decision-making during trades, weighing options between securing profits versus risking full exposure on remaining contracts.
  • Critiques common misconceptions about trailing stop losses among traders who lack practical experience or understanding of effective risk management techniques.
  • Reiterates that successful traders must adapt their strategies based on real-time data rather than relying solely on theoretical approaches or generalized advice from uninformed sources.

Trading Insights and Strategies

Understanding Market Behavior

  • The speaker emphasizes that many traders gamble without understanding market movements, leading to unpredictable outcomes. They highlight the importance of knowledge over luck in trading.
  • With 30 years of experience, the speaker contrasts their expertise with newer traders who may lack foundational knowledge, suggesting that true skill comes from deep market understanding.

Proof of Trading Skills

  • The speaker critiques those who showcase trade logs as proof of success, arguing that anyone can fabricate such records. Authenticity in live trading is essential for credibility.
  • They assert that real-time execution and management of trades demonstrate genuine skill, particularly when using platforms like TradingView which cannot be easily manipulated.

Transitioning Markets

  • The discussion shifts to Forex trading, where the speaker notes a preference for other markets due to their precision and forgiveness compared to Forex's volatility.
  • Central Bank Digital Currencies (CBDCs) are mentioned as a significant factor influencing both crypto and Forex markets, prompting the speaker's decision to avoid Forex trading altogether.

Trade Management Techniques

  • The speaker discusses strategies for managing trades effectively by taking partial profits along the way and adjusting stop-loss orders based on market behavior.
  • Emotional detachment from trade outcomes is emphasized; traders should focus on strategy rather than emotional investment in results.

Real-Time Trading Demonstration

  • A live demonstration showcases trade executions in real time, reinforcing transparency and authenticity in the trading process without any deceptive practices involved.
  • The speaker expresses commitment to providing free educational content throughout the year while acknowledging skepticism from some viewers regarding their methods.

Performance Analysis

  • In summary, a comparison between US 100 CFD performance versus actual futures contracts highlights better alignment with daily balance metrics during specific trades discussed earlier.

How to Build and Manage a Funded Trading Account

Introduction to Funded Accounts

  • The speaker discusses strategies for building and managing a funded trading account, emphasizing realistic expectations rather than aiming for extraordinary results.
  • The importance of demonstrating superior trading skills in competitive environments is highlighted, suggesting that this approach can frustrate others but is essential for personal growth.

Personal Trading Philosophy

  • The speaker shares their practice of executing trades on demo accounts to illustrate concepts without being tracked, indicating a preference for privacy over public accountability.
  • They clarify that they are not obligated to show every trade, encouraging viewers to focus on the logic behind their teachings instead.

Market Analysis Techniques

  • A detailed examination of the US-100 market structure is presented, with emphasis on identifying imbalances and fair value gaps as critical components of market analysis.
  • The speaker notes the similarities between different markets (e.g., futures vs. Forex), asserting that traders can apply learned strategies across various platforms.

Execution Strategies

  • An explanation of smart money reversal and market maker buy models is provided, illustrating how these concepts guide entry points in trading decisions.
  • The speaker encourages flexibility in trading approaches, allowing individuals to adapt strategies based on personal understanding and comfort levels.

Broader Application of Trading Concepts

  • Emphasis is placed on recognizing patterns and setups that resonate with individual traders' experiences, fostering confidence in their unique trading styles.

Trading Experience and Insights from a Veteran Trader

The Importance of Experience in Trading

  • The speaker emphasizes their lack of experience in crypto trading, having only practiced on a demo account. They highlight their extensive background in trading US futures and S&P since 1993.
  • Criticism is directed towards current educators in the trading space, many of whom are inexperienced or too young to have witnessed significant market events like crashes or bubbles.
  • The speaker stresses the value of learning from someone who has endured the challenges and traumas associated with long-term trading, suggesting that true understanding comes from real-life experiences.

Transitioning Away from Public Teaching

  • With three decades of trading experience, the speaker expresses a desire to step back from public teaching, indicating that future insights may be shared privately if time allows.
  • Acknowledgment is made regarding the potential end of their public engagement, as they plan to focus on personal enjoyment and family life moving forward.

Realities of Trading

Playlists: 2023 ICT Mentorship, 2023 ICT Mentorship
Video description

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.