SUPPLY & DEMAND + MKT STRUCTURE. swing point.

-Swing Point = The last HH/HL/LH/LL that is formed once a

Supply = Where price has pending SELL orders.
retracement has occurred. When a retracement occurred
Demand = Where price has pending BUY orders. on our previous example, then the previous candle’s low
becomes a swing point (HL/LL) since the swing point is the
We seek to SELL at Supply and BUY at Demand areas. This areas of
low.
Supply and Demand are called blocks thus we refer to them as
Order Blocks (OB’s).
Retracement.
A Bullish OB (BuOB) is a Demand area and a Bearish OB (BeOB) is
a Supply area.

VALIDATION OF OB’s

We have to validate OBs to determine which ones are tradable.

We do this in a Top-Down Analysis formation. Swing low (HL/LL).

➢ We then need to understand Fair Value Gap (FVG)
➢ We first begin by understanding a Retracement. concept. An FVG is formed within 3 consecutive candles.
- Retracement = When price (current candle) takes out the - The 1st candle forms and closes, say Bullish (Up).
previous candle’s high (h)/ low(l) in the opposite direction - The 2nd candles also form and closes bullish.
on the same Timeframe. Say price on M1 is moving, the -When the 3rd candle is formed and closes, say Bearish, we
previous candle was bearish (down). When price takes out then mark the 3rd candle’s low and the 1st candles high. If
the previous candle h (upwards) we then consider a there is a distance between these 2 points then we call
retracement from the previous candles h. that an FVG. The order of the candle’s color is irrelevant as
- Once a retracement has occurred it automatically forms a long as we have 3 consecutive candles and between the 1st
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 and the 3rd candle’s h/l we have a gap. ➢ The FVG is formed in 2 ways;
-The swing h/l is either the 1st or 2nd candle to the FVG.

A Swing h
50% FVG.
B
➢ The distance from point A to B is an FVG. When we drag a FVG
Fibonacci to those 2 levels then mark 50%, we call that
50% FVG.
➢ In order to validate an OB, we need to have a retracement ➢ On the image above the swing h is the 1st candle to the
which then creates a swing point then followed by an FVG FVG. We then draw a block from 50% FVG to the swing h
in the opposite direction of the retracement. to create an OB, for this case a BeOB.
➢ For a Bearish retracement, the previous candle should be - If the 2nd candle after the swing h forms an FVG given the
Bullish and for a Bullish retracement the previous candle swing h candle was not the 1st candle in an FVG we then
should be Bearish. The P. A’s color taking the h/l is vague. also take 50% of that FVG to the swing h as the OB.
➢ When an OB is created, we then need to configure an
extreme point where we consider price not to break after
mitigating the OB.
➢ Mitigation = when price taps into an OB then causes a
retracement on the same Time frame.
- For every OB we use their swing points as the extreme
a) Bearish b) Bullish i.e. we consider price will not break them.
retracement. retracement.
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 ➢ When price retraces back to the FVG of an OB then sweeps different color. The 2nd candle is also the 1st candle to an
the last swing that caused this movement, the last h/l FVG. We then consider the OB to be from the 2nd candle’s
above/below the OB is called an inducement. h/l to the 1st candle’s h/l. If the 1st candle’s h/l is also above
-So instead of marking 50% FVG we’ll also mark this last h/l the 2nd candle then we also consider it.
as part of the OB. It can also be EQH/EQL which increases
the probability.
1st 3 candles are consecutive and 2nd
New BeOB. candles is a different color from 1st
and 3rd and is also 1st candle in an
Price retraces to FVG but not 50%. FVG. If 2nd candles h is a swing h on
M1 we consider this a BeOB.
Last swing l that caused the
retracement to the FVG swept.
➢ We only tend to use M1 OB on our setups thus we need to
validate them.
a) We 1st locate our M5 structure (swing points) from the
start of Asia to the current P.A. c) Once we have located every M5 OB we switch to M1.
b) We then mark out all valid M5 OBs at the swing points. - We then look for OBs on M1 located within M5 OBs and
We also consider a drop base drop (DBD) / rally base rally highlight them as major OB’s.
(RBR) as a valid OB if on M1 the 2nd candle’s h/l on M5 is a -We then also mark the retracement that caused the M5
swing point. swing points, from the retracement to the swing h/l we
- A DBD/RDR is when we have 3 consecutive candles and locate M1 OBs and mark them as minor OB’s.
the 1st and 3rd candle are the same color while the 2nd is a -We don’t consider DBD/RBR on M1. Also, M5 OBs with no
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 M1 OB are disregarded. ➢ When price is mitigating an OB, if our M5 SL h/l is 5 pips
-We then also mark the nearest M1 OB to P.A. from entry we then consider it, if its above 5 pips we
➢ At this point we have validated and located all OBs. consider the OB’s extreme.
- If our current OB was as a mitigation of a previous OB, we
then use the previous OB’s extreme.
MKT STRUCTURE
M15 MKT Structure.
➢ The structure of the market (MKT) is determined by swing
➢ This is the last part connects and tells us when and how to
points. Every swing point is either a HH/HL/LL/LH.
use MKT Structure + OBs.
➢ We use M5 to define our MKT Structure. Structure does
➢ Here we use a concept called M15 Opposite Color Candle
not define trend in its entirety, it only allows us to locate
Shift (M15 OCCS).
the most recent trend and not overall.
- M15 OCCS = A concept used to define the incoming trend
➢ The most recent structure is where we place our SL h/l.
using 2 candles color candle close combined with OB +
- SL h/l = Where we anticipate price will not break
MKT Structure.
(protected h/l). If price breaks, we start to consider a shift
in trend. HH – We place our SL h.
M15 OCCS
➢ It is formed when the current candle either closes in the
same / opposite color as the previous candle.
HL – We place our SL l.
➢ When it closes in the same color candle it is referred to as
M15 Continuum and if opposite color then M15 OCCS.
➢ When validating an OB, we located the nearest OB to P.A.
➢ We use only 4 candles A, B, C and D on M15;
This OB should be within the SL h/l.
- Candle A = 9.30AM candle open.
- Candle B = 9.45AM candle open.
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 - Candle C = 10.0AM candle open. B/C tap into B/C sweeps
- Candle D = 10.15AM candle open. a BeOB SL h.
All UTC+3 Nairobi time. ❖ We ❖ We
➢ For Candle A all we look at is what color did it close. look look
to to
➢ We then start to look at M15 OCCS and Continuum from
SELL BUY
candle B.
➢ Below are scenarios on how we approach them. CANDLE A/B IS BEARSIH.
CANDLE B/C IS BEARSIH. CANDLE B/C BULLISH.
CANDLE A/B IS BULLISH B/C has not B/C has A BeOB B/C tap into
CANDLE B/C BULLISH. CANDLE B/C BEARISH. sweet a’s h sweep a’s h between SL a BeOB
B/C has not B/C has A BuOB B/C tap into h and B/C’s
sweet a’s l sweep a’s l between SL a BuOB h
l and B/C’s l ❖ We ❖ We ❖ We ❖ We
❖ We ❖ We ❖ We ❖ We look look look look
look look look look to to to to
to to to to SELL SELL SELL SELL
BUY BUY BUY BUY A BuOB No BuOB No BeOB B/C sweeps
A BeOB No BeOB No BeOB B/C sweeps between SL between SL between SL SL h.
between SL between SL between SL SL l. l and B/C’s l l and B/C’s l h and B/C’s
h and B/C’s h and B/C’s l and B/C’s l h
h h ❖ We ❖ We ❖ We ❖ We
❖ We ❖ We ❖ We ❖ We look look look look
look look look look to to to to
to to to to BUY SELL BUY BUY
SELL BUY SELL SELL
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 B/C tap into B/C sweeps the previous candle it its opposite direction, we
a BuOB SL l. then trade the direction of the takeout.
❖ We ❖ We ➢ Once at 11AM, we look to see which direction the
look look London open on H1 closed. We then look for trades
to to
in its opposite direction.
BUY SELL
-We begin when the 10.30AM candle closes. The
➢ These are scenarios we are looking out for After previous candle should be the last candle h/l. We
London Open. are looking for an M15 OCCS and not continuum.
➢ We only consider the 1st scenario i.e. say A is -If the 1st reversal is formed and price takes out that
bearish and B bullish then B sweeps SL l and taps last h/l then we are done for the day.
into a BuOB, we look to BUY. -Once the 11:45AM candle closes we do not look
➢ When candle C opens, and during its formation it for any M15 OCCS reversals.
takes out the previous candle it its opposite
direction we then trade the direction of the LIQUIDITY LEVELS (LL)
takeout. These are levels that attract price towards them
- If A was bullish and B bullish, then price during C and hold huge amounts of orders.
sweeps B’s low, we then consider SELLS. ➢ We only consider 3;
➢ If candle C forms a continuum, then we don’t look a) Asia h/l
for further trades till reversal time. b) FF h/l
-If c forms an M15 OCCS, we only look for trades c) PH/LOD
during candle D if during its formation it takes out ➢ Once price takes out any of these levels then forms
an M15 OCCS we trade them regardless of OB.

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 ➢ If price takes out Asia h/l (Provided FF did not ➢ Once at a 40% profit, double the initial risk
sweep it), we then hold the trades till 8AM unless a = 4% and trade till 100% then resume to the
high impact news then we can consider to close initial risk.
before.
TOP-DOWN ANALYSIS
ENTRY MODULES
➢ Mark PH/LOD.
➢ How we enter a trade; ➢ Mark Asia h/l.
-We only take trades after an OB mitigation. ➢ Mark FF Open/London Open.
-When price causes an M15 OCCS, we trade ➢ Draw out M5 Structure.
only the 1st OB to be formed. ➢ Locate M5 SL h/l.
-Breakout of a SL h/l. ➢ Highlight M5 OBs.
➢ Shift to M1 to refine M5 OBs.
EXIT MODULES
➢ Locate M1 swing OBs.
➢ We exit a trade once an M15 OCCS reversal has ➢ Shift to M15 to highlight candle’s A
been formed. color.
➢ M15 LL OCCS has been formed. ➢ Return to M5 to spectate and speculate
➢ At 1:3 set B.E / Price sweeps LL. while watching M15 candles using
indicator.
RISK MANAGEMENT
➢ Once price aligns shift to M1 to look for
➢ Risk 2% per trade with a max of 3 trades per entries.
day and 24% per week.
➢ For every trade set 1:3 R/R.

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