ICT Mentorship 2022

Video 2:

Liquidity pools are created by relatively equal highs or lows.

What is the market it drawn to? Liquidity (buy/sell stops) or imbalance (single candles
that break a structure without a following candle to test the structure).

**One Weekends preferrably, decide if you feel the market will be moving higher or
lower for the week. This is sets your initial bias for the week. Then go to DAILY to see
where you are in that move.**

Anytime you’re anticipating a significant move lower, anticipate a stop hunt or short term
high to be taken out.

Anytime you’re anticipating a significant move higher, anticipate a stop hunt or short
term low to be taken out.

** Larger liquidity pools are the ones in sync with the over all trend.**

Once the stop hunt occurs, drop to lower timeframe to find imbalance after the break of
structure.

Video 3 Internal Range Liquidity & Market Structure Shifts:

Order Blocks: Taken liquidity, market structure shift, imbalance gap. It’s a change in the
state of delivery.
**The opening of the candles**

Internal Range: Short term Lows/Highs that were looking for the market to trade back
into.

Video 6 Market Efficiency Paradigm & Inst Order Flow::

Time of day is crucial when engaging with price

Smart money looks to kill the Uninformed retail trader

Fair Value Gap (FVG) -

Bearish Setup::
Institutional Order Flow (IOF) is based on a 3 candle formation
Optimal formation for a bearish FVG will be found after a run into Buyside Liquidity
Typically found just about single Price Highs or Multiple Price Highs in a relative basis
(double tops)

Bearish FVG
1st candle is the High
2nd candle has to have a close below candle 1
3rd candle has to continue without running back into the 1st candle close

To balance out this inefficiency, the market will have to trade back into that area at
some point. It is trade half then a candle with trade through it.

Anything prior to this formation doesn’t matter at this moment.

** Sell limit about candle 3 in FVG, StOPS above candle 1**

This is what creates a market structure shift. The market will see price rally above an
old high and then QUICKLEY with a strong candle shift lower.
Significance is placed on the term “quick” and Displacement lower, not a small candle
move lower or wick.

*All time frames*

***TIP** Depending on how the market closes below the Displacement Low will tell you
if it will continue lower or bounce and make a higher High.**

** IF FVG isn’t there, you wait or go to a different instrument to trade**

Bullish FVG::
Internal Liquidity range = Partial Take Profit (around 50% fib met with FVG)
External Liquidity range = Close the trade

Video 7 Daily Bias & Consolidation Hurdles

Video 8
Video 12 Advanced Market Structure
2 Questions to ask when looking at price::
1. Does the market have a reason to go up for liquidity for a buy stop or is it likely to up
to balance an imbalance (FVG)
2. Does the market have a reason to go down for short side liquidity or to rebalance an
old imbalance (FVG) below market price.

UP for stops or rebalance

Down for stops or rebalance

How do you arrive with the answer?

Every Single time price rebalances an imbalance, label the swing it makes (internalize)
intermediate term high or low

An intermediate term low has a short term low to the left and right of it
An intermediate term high has a short term high to the left and right

The hierarchy in parent to child price swings subordination that the smaller time frame
price swings adhere to is directly linked to the order flow of the higher time frame chart.
Meaning the daily chart has the bulk of the volume when it’s coming into the market.

If we have an intermediate swing high/low broken, then we are targeting the higher
timeframe imbalance or liquidity pool. This is a significant break of market structure.

Video 13 More Market Structure

If the move is bullish, bear candles should not be violated, breached or broken through .
Meaning they’re creating a support.
If the move is bearish, bull candles should not be violated, breached or broken through.
Meaning they’re creating a resistance.

**HOW TO DETERMINE A HIGH PROBABILITIY ORDER BLOCK**

BULLISH:: IMBALANCE MUST BE COUPLED WITH A DOWN CLOSED CANDLE
WITH THE UNDERLYING BIAS BEING BULLISH

BEARISH:: IMBALANCE MUST BE COUPLED WITH A BULL CLOSED CANDLE WITH

THE UNDERLYING BIAS BEING BEAR

VIDEO 18
BETWEEN 7AM-10AM

START on Daily to gain your bias. Find the imbalance and fair value gap that price will
return to eventually. Mark ur most recent Hi/Lo structure for last 3 days. This is the
frame work you will b working within to look for trades.

3 Time Frames Daily/1 Hour/15 Minute or 4 Hour/30 minute/ 5 minute

On 15M/5M we are interested in the 12 AM opening chart. Highlight with a horizontal

ray.
**ONCE THE MARKET HITS A RELATIVE HIGH/LOW, ASK DOES IT CREATE
DISPLACEMENT? MEANING DOES IT MOVE AWAY WITH STRENGTH AND
VOLUME, IS THERE A FVG OR IMBALANCE.** IF SO

Set your buy/sell limit right at the edge of the fvg that you highlight

Drop to the 5M to see if there is a FVG as well

** An imbalance is what makes an order block **

Video 21 - How to use Midnight and 8:30 Am opening prices

RISK ON/RISK OFF markets - When the dollar is going up, that’s risk off, meaning
generally every other market could start to decline. When the dollar is going down,
that’s risk on, every other market could start to rally.
Opening price @ Midnight time is used for the opening of London session 2-5 and
power of 3 for daily range.

830 Am is used for the opening of New York session 830-11

Power of 3 - We want to see a bull run above the high at midnight for a sell scenario.
We want to see a bear run below the low at midnight for a buy scenario. This is the
Judas Swing/False Rally/Stop Hunt.

***************************************ICT 2016 Core Content Vids

Video 1:: Elements to a trade setup

A) Context of Framework surrounding the idea - what makes the idea favorable for a
trade. Not just support resistance.
1) Expansion 2) Retracement 3) Reversal 4) Consolidation

B)Reference points in Institutional Order Flow

1)Order Blocks 2) FVG & Liquidity Voids 3) liquidity pools and stop runs 4) equilibrium

Expansion - When price moves quickly from a level of equilibrium

Importance - When price leaves a level quickly this indicates a willingness on the part of
the MM to reveal their intended repricing model.
What do we look for in Price - The order block the MM leave at or near the equilibrium

Retracement- When price moves back into the recently created price range.
Importance - When price returns inside a recent price range this indicates a willingness
on the part of the MM to reprice levels not efficiently traded for Fair Value. (It returns to
FVG).
What do we look for in price - FVG and Liquidity Voids.

Liquidity Void-When Expansions happen, they create FVG/LV. A retracement looks to

fill them.

Reversal- When Price moves the opposite direction that current direction has taken in.
Importance - When price reverses direction it indicates the MM have ran a level of
Stops and a significant move should unfold in the new direction
What to look for - Liquidity Pools just above an old High or just below and old low
Consolidation - When price moves inside a clear trading range and shows no
willingness to move significantly higher or lower
Importance - When price consolidates, it indicates the MM are allowing orders (liquidity)
to build on both sides of the market. Expect a new expansion near term
What to look for -We are waiting for The impulse swing in price away from the
Equilibrium price level that is found at the 50% fib of the consolidation range

Reference Points In Institutional Order Flow

1)Order Blocks 2)FVG & LV 3) Liquidity Pools & Stop Runs 4)Equilibrium

Daily Range Structure:: price delivery Algotith

Price Equilibrium
Manipulation
Expansion
Reversal
Retracement (Requires 4 candles that create a swing point)
Consolidation

***USe this for training beginners***

What YoU should be doing
1. Creating daily price action logs with price charts
a. Daily Chart - 12 months no less than 9 months view
b. 4H - 3 months view
c. 1H- 3 weeks view
d. 15m - 3-4 day view
2. Resist the urge to forecast price movements right now.
1. Do note where price shown a quick movement from a
specific level
2. Note recent highs/lows that haven’t been retested
3. Note ares on the charts where Price has left “clean” or equal
highs/lows
4. Note what days weekly highs/lows and what kill zone if
formed in (London or NY)
5. Note Daily high low every trading day and what kill zone if
formed in

*************The Secrets to high reward trade setups

1)Patience
2)Define Trade Environments
3)Determine Trade parameters
4)Executable Criteria
5)Understand Why it should pan out
6)Experience For Future Reference

Efficiency in trading comes by way of Process Oriented Thinking, not by way of

reactionary or impulse thinking or rushing ahead to trade signals.

Big Picture Perspective: Only 2 of these need to agree to arrive to your Big picture

1)Macro Market
2)Interest Rate Analysis
3)Intermarket Analysis
4)Seasonal Influence

Macro Market Analysis -

1) Inflationary Market
2) Deflationary Market

Interest Rate Analysis

1)Higher Rates
2)Lower Rates
3)Unexpected Change

Intermarket Analysis
1)CRB Index - Commodities
2)USDX- US dollar Index

Seasonal Influence
1)Bullish Seasonal Tendencies
2)Bearish

Intermediate Perspective:
1)Top Down Analysis
2)COT Data (commitment of traders data)
3)Market Sentiment
Top Down Analysis -
1) Monthly Chart
2) Weekly Chart
3) Daily Chart

Cot Data
1)Bullish Hedging by Smart Money
2) Bearish Hedging
3) Extreme Levels Historically

Market Sentiment
1)Extreme Market Bullishness
2)Extreme Market Bearishness
Short Term Perspective:
1)Correlation Analysis
2)Time & Price Theory
3)IPDA- Interbank Price Delivery Algorithm

Correlation Analysis
1)USDX SMT Analysis
2)Correlated Pair SMT Analysis

Time & Price Theory

1)Quarterly Effect - Every 3 months or so is a price shift
2)Monthly Effect -Quarters Theory
3)Weekly Range
4)Daily Range
5)Time of Day
IPDA - Interbank Price Delivery Algorithm
1)Institutional Order Flow
2) Liquidity Seeking
3) Market Efficiency Paradigm

MONTH 3 INSTITUTIONAL SPONSORSHIP

IDENTITY TO A LONG:
1)Higher TF Price Displacement — Reversals, Expansion or Return to Fair Value
2)Intermediate TF Imbalance in Price — Move to Discount or Sell Side Liquidity Run
3)Short Term Buy Liquidity Above The Market — Ideal for Pairing Long Exits to Sell to
4) Time of Day Influence — London Open Low of Day or New York Low Formation
5)Buy NEAR OR @ OPENING PRICE OF MIDNIGHT

IDENTITY TO A SHORT:
1)Higher TF Price Displacement — Reversals, Expansion or Return to Fair Value
2)Intermediate TF Imbalance in Price — Move to Premium or Buy Side Liquidity Run
3)Short Term Sell Liquidity Below The Market — Ideal for Pairing Short Exits to Sell to
4) Time of Day Influence — London Open High of Day or New York High Formation
5)SELL NEAR OR @ OPENING PRICE OF MIDNIGHT

PRICE IS FRACTAL - EVERYTHING REPLICATES

UNFULFILLED HIGH OR LOWS ALLOW YOU TO USE OLD HIGHS/LOW AS
SUPPORT/RESISTANCE