TRENDS (EXPANSION AND RETRACEMENT)

Expansion =>occurs when there is an impulse movement towards a

direction.

Retracement => is the correction movement after an impulse

movement.
 FIBBONACCI RETRACEMENT
USED TO DETERMINE THE END OF THE RETRACTION MOVEMENT, USUALLY
THE PRICE RETRACTS TO 50% OR UNTIL OTE (0.62, 0.705, 0.79) BEFORE
ANOTHER IMPULSE MOVEMENT OCCURS.

BMS - BREAK IN MARKET STRUCTURE

BMS occurs when the price closes above / below a swing high/low,
generally, every trader should trade in the direction of the Higher Time
Frame BMS.
NOTES:
AFTER BMS ALWAYS WAIT FOR RETRACEMENT.
 Range High and Range Low
After the BMS there will always be the formation of a new
consolidation, that is called RH and RL.
NOTES:
=> Trade in the direction of the BMS
=> After BMS Wait for retracement to 50% OR OTE of Fibonacci levels.

FAILURE SWING (SMS)

When there is an uptrend market and the price fails to break the last top
(Swing High) and breaks the previous bottom (Swing Low), an SMS is
considered to have occurred (vice versa for Bearish).
FAILURE SWING (SMS)

MARKET STRUCTURE
The price can simply be found in one of the 3 phases below:
1.In a CONSOLIDATION
2.In an UPTREND
3.In a DOWNTREND

Market Structure In Bullish Conditions

[VICE VERSA FOR BEARISH CONDITIONS]

The bullish market is characterized by making Higher Highs and Higher Lows,
but this characterization is not enough, it is necessary to say that bullish
markets are always breaking swing Highs and respecting swing lows.
The fact that the price has broken a swing high, indicates that higher prices
should be expected, so it is negotiated in the trend in which the market
structure was broken.

Market Structure In Bullish Conditions

[VICE VERSA FOR BEARISH CONDITIONS]
 MARKET STRUCTURE

LIQUIDITY
The FOREX market is a zero-sum game, which means that for a
trader/institution to buy/sell 1 currency pair it's necessary that there is
another trader/institution with an opposite position. If Smart Money
(Banks) want to buy a currency pair they will need sellers in the market,
the existing facility to place these positions In the market is called
liquidity
The Liquidity is defined by Stop losses, where the Stop losses exist is
where the liquidity also exists, Smart Money need to activate the stop
losses of existing orders in the market so that they can place their
positions in the market.

The banks manipulate the price because of liquidity. Banks negotiate

large trading volumes and sometimes find it difficult to find the other
side of their trades, so they manipulate the price so that they can
have their positions in the market.
LIQUIDITY TYPES
In the FOREX market there are two types of liquidity, which are:
 1.Buy Stops Liquidity (BSL)
2.Sell Stops Liquidity (SSL)

Buy Stops Liquidity (BSL)

The BSL is originated by Stop Losses of sell orders, after the BSL is taken, the
market reverses to the downside, because banks use the BSL to place sell
orders in the market.
What to focus on (for BSL)
PMH - Previous Month High
PWH - Previous Week High
PDH - Previous Day High
HOD - High Of Day
OLD HIGH - Swing High

EQUAL HIGHS = Retail Resistance HOD, OLD HIGH.

PMH - PREVIOUS MONTH HIGH

PWH - PREVIOUS WEEK HIGH

PDH - PREVIOUS DAY HIGH

 HOD - HIGH OF DAY

EQUAL HIGHS = Retail Resistance

Sell Stops Liquidity (SSL)

The SSL is originated by Stop Losses of Buy orders, after the SSL is
taken, the market reverses to the Upside, because banks use the SSL
to place Buy orders in the market.
What to focus on (for SSL)
PML - Previous Month Low
PWL - Previous Week Low
PDL - Previous Day Low
LOD - Low Of Day
OLD LOW - Swing Low
EQUAL LOWS = Retail Support

SSL TAKEN SSL TAKEN

X= Previous month Low[PML]

Previous Week Low[PWL]
Previous Day Low[PDL]
Low of the Day[LOD]
OLD LOW.
 ORDER BLOCKS [OB]
Order Blocks are candles where Market Makers (Banks) have placed
their positions, generally, the market returns to those candles and
they are never violated ("if they are really OB's")
There're 2 types of Order Blocks:
1.Bullish Order Blocks
2.Bearish Order Blocks

Bullish Order Blocks

The Bullish Order Block is the last bearish candle before the bullish
movement, that Break The Market Structure Higher. Represents a high
possibility of holding the price, when the price returns to it.
Bearish Order Blocks
The Bearish Order Block is the last bullish candle before the bearish
movement, that Break The Market Structure Lower. Represents a high
possibility of holding the price, when the price returns to it.
 ORDER BLOCKS IN AN ORDER BLOCK
OB in an OB strategy will give you a minimum risk and a maximum profit.
To use this strategy, First we mark your OB on a higher timeframe. In the
example below, we found an OB on the 4hrs timeframe and it is marked with a
green rectangle.

Then we drop down to a lower timeframe like 2h, 1h, 30mins or 15mins to find
a lower timeframe Order Block for our entry.
In the example below, we drop down to 1hr timeframe. In the 1hr timeframe,
we can still see our point if interested marked in green. Our order flow is
bearish as marked by the arrow by the left and the second arrow represents
the retracement to the Order Block we marked with a green rectangle from
our 4hr point if interest. Next, we will wait for a break of market Structure to
the downside on the 1hr chart.
As price continue to print, we can see a shift in market structure (CHOCH)
occur to the downside. That indicates that the downward trend is about to
continue.

Now we proceed to look for a new order Block inside the existing order Block.
That is inside the 4h OB we marked earlier, we will look for another Order
Block in the 1hr timeframe.
The 1hr OB is marked with a red rectangle. Now we will wait for price to trade
to the new OB marked with red rectangle and once price get there, we will
enter a sell trade. Our stop loss will be at the top of the red rectangle and take
profit will be at liquidity of opposing direction as shown in the photo below.

Now see how

beautiful market go to our take profit. This strategy gives you the highest
probability trade and also gives you the best kind of entry with less risk
exposure. The key factors to know about these strategy is to know the order
flow, market structure, timeframe analysis and order Block.
Let me show you another example...

We found this
OB from a 4hr timeframe. If we were to enter this trade from the 4hr OB, we
will be risking 13pip for stop loss.

Next, we drop down to a lower timeframe and refine the OB so that we can
get a smaller stop loss.
In the 1hr timeframe, we will wait for price to trade to the 4hr OB and once
price trade there, we will expect a shift in market structure (CHOCH).

After a shift in
market structure occurs, we will look for an OB in the lower timeframe and
mark it. As we can see our new OB will give us a stop loss of 7pip which is
smaller than the 13pips we have from the 4hr OB.
Now we wait for price to trade to our new OB and enter a sell trade from
there. Our stop loss will be at the high of our new OB and our take profit will
below liquidity on the sell side.

And this is
how our trade pan out.
 SESSIONS
The Daily Range is defined by 3 important sessions, which are:
1. Asian Session
2. London Session
3. New York Session

Asian Session
The Asian session is characterized by being a consolidation (of 20 - 40 pips),
due to the lack of liquidity in the market. The session starts from 10pm to
1am New York time.
London Session
The London Session begins at 2am to 11am New York time is
characterized by making the Low Of Day or High Of Day, it can be used
to take traders to the opposite side of the true direction of the day
(Because Of Liquidity).
Delimitation: Not the whole London session need attention, focus on
the first 2-3 Hours at the beginning of the session: From 02am New
York time to 5am new York time.

New York Session

The NY session is characterized by being a retraction after the London
Session made the Low/High of the day, sometimes the NY session can
make the Low/High of the day. The session begins at 7am to 4pm
New York Time. 12noon to 1pm is the launch break hour and rapid
movement doesn’t often occur during this time.
Delimitation:
Not the whole NY session need attention, focus on the first 2-3 Hours
at the beginning of the session: From 07amNew York Time to 10am
New York Time.
Accumulation, Manipulation And Distribution
[AMD]
Accumulation:
The accumulation of positions generally occurs during the Asian
session, the accumulation is characterized by being a consolidation
(Asian session), but it may not be the Asian session.

Manipulation:
usually occurs at the opening of the London session (sometimes it
can be NY open), this Manipulation consists of taking the price to
the opposite side of the true direction of the rest of the day.

Distribution:
occurs when MMs liquidate (Exit) their positions.
 Bullish AMD

Bearish AMD

How To Trade AMD:

-Accumulation: the price will be ranging.
- Manipulation: the price will break the range direction to trap traders
(Because of Liquidity)
- Distribution: the price will go against the Manipulation movement, and
here, look to go long/short on: Order Block,
Liquidity sweep + BMS + RTO,
Shift in Market Structure + BMS + Order Block
 Bullish AMD

Bullish AMD

IMBALANCES/FAIR VALUE GAP (THE FVG)

The market does not only engineers liquidity in the markets by moving price,
by design it has to offer fair value for buying and for selling. In some
cases, Market may reprice too quickly in one direction over
another, thus leaving an inefficiency in price delivery (A FVG).
A FVG is when price leaves a specific level quickly and price action is seen only
on one direction. This can present a very good area for new setup or taking
profit.
In order for market to maintain its fair value, it will reprice
to rebalance the inefficient price action to offer fair value to both
sides(buy/sell) of the market.
NOTE: The image above shows some FVG and how price went back to
rebalance it. Also, the gaps in the higher timeframe are more important
than the gaps in the lower timeframe as price are likely to be drawn to
the higher timeframe gap than the that of the lower timeframe.

ICT SILVER BULLET STRATEGY

This strategy is going amaze you once you master it as you don't need to know
the direction of the market.
There 4 major important things you need to know about this strategy.
1) TIME
2) LIQUIDITY
3) MODALITIES
4) MONEY MANAGEMENT

TIME: Time in this strategy is very important. This strategy only works in the
New York session. And in the New York session, you're going to focus on
9:30am to 11 New York time. To make it easier, go to your tradingview and set
your time to UTC-4(New York time).
The next thing you need to do is to drop down to 1 minutes timeframe of any
USD pair. You can also use it on indices such as US30, S&P500, Nasdaq e.t.c.
LIQUIDITY: Within the window of 9:30am to 11am NY time, you wait for price
to take buy side liquidity or sell side liquidity. This can come in form of an old
high/low, short time high/low, equal high/low, previous day high/low, previous
week high/low etc.
MODALITIES: After liquidity has been taken, you wait for a shift in market
structure to happen. Inside the shift in market structure, there would be a FVG
formed in the price leg that broke the structure. The FVG is your point of entry.
MONEY MANAGEMENT: Your stop loss should be at the opposing liquidity,
either a short term high/low, equal high/low, old high/low etc. depending on
the direction of the market.
APPLICATION

1) On your
chart, mark the 9:30 to 11:00am with a vertical line or a rectangle
and wait for price to reach the 9:30am.

2) Once
price gets to the point you mark, you wait for a short time liquidity to
be taken, either a Buy Side Liquidity(BSL) or a Sell Side Liquidity(SSL).
3) After liquidity was taken, you expect a Market Structure Shift(MSS)
to the opposite side.

4) In
the downward movement that broke the market structure to the
downside, we look for a FVG. We will use this FVG as our entry.
 5)Our take profit is on the opposing liquidity.

HERE ARE OTHER EXAMPLES

 ICT TGIF STRATEGY
This particular setup repeats itself almost every single week. It was thought by
ICT himself. It is called TGIF setup which means “Thank God Its Friday” which
means this particular setup happens every Friday across different currency
pairs and different financial assets.
To use this strategy, we are going to pay attention to weekly candles because
that’s the exact candle that will give us the setup we are looking for.
On a trending week, weather bullish or bearish week, we expect to see the
market retraces to at least 20 or 30% of the weekly candle on Friday and the
retracement starts from 9am to 2pm new York time.

BULLISH CONDITION
In a bullish condition, the market opens at point 1, then trades lower to form
the low of the week. It then reverses and trades higher to form the high of the
week and closes as shown in point 4. The retracement from the high of the
week(point 3) to the candle’s close(point 4) often happens on Friday and that’s
the movement we plan to catch.
Note that the candle in the examples are weekly candles and it is advisable to
have 4 -5 currency pairs on your watchlist incase you don’t find it on one pair,
you will find it in another.
BEARISH CONDITION
In a bearish condition, the market opens at point 1, then trades higher to form
the high of the week. It then reverses and trades lower to form the low of the
week and closes as shown in point 4. The retracement from the low of the
week(point 3) to the candle’s close(point 4) is the movement we plan to catch.
Note that the candle in the examples are weekly candles.
 APPLICATION
We are going to start our analysis from the monthly timeframe then we
dropdown to the weekly timeframe, down to the 15min timeframe to
understand how this setup practically happens.

From the
monthly timeframe, we can see that price retraced from an uptrend. It is
pulling back into a bearish orderblock and has touched the open of the
orderblock, so we will pay attention to the monthly candle and break it down
to the weekly candle down to the 15mins timeframe.

The
present weekly candle is highlighted in pink shade. We know that price has
touched the open of the monthly Orderblock so we expect a retracement to
reject from the OB and trade lower to the down side so we are going to drop
down to the daily candle.

From this
image, we can see that Monday’s candle formed the low of the week and
Friday’s candle formed the high of the week and retraced backed to 30% of the
weekly range to close bearish as highlighted in the pink shade. Now, we will
break our Friday’s candle into a lower timeframe to see how we would have
gotten an entry to make money in the market.
 We drop
down to the hourly candle and it is highlighted in purple shade. What we look
out for on the hourly timeframe is an obvious shift in market structure starting
from 9am to 2pm New York local time. This shift in market structure will
indicates that market is ready to go down and only then we can declare the
candle circled with blue line as the high of the week.

To make it
easier, we drop down to the 15mins to find an obvious shift in market
structure and we have it at the point marked with “mss”.
 After the market
structure shift, we wait for price to retraces back to the price leg that broke the
market structure. In the price leg, we can enter a sell trade on a bearish Order
Block or a FVG depending on the one that gives a smaller stop loss. Stop loss
will be at the high of the week and take profit should aim at a retracement to
20-30% of the weekly range using a Fibonacci Retracement tool.

At the end of
the Friday’s close, this is how the trade pan out and it gave us a 58pips profit.
 KILLZONE
Killzones are basically time of the day were you have a probability
trade setups. During this time period, any setups found within them has a high
probability of going in your direction. We have 3 killzones in the forex market.
1) The Asian Killzone
2) The London Killzone
3) The New York Killzone

ICT LONDON KILLZONE STRATEGY

The London is a trading time were we have high probability of getting the high
of the day or low of the day. The time for the London killzone is between 2am
to 5am New York time and often take the liquidity of the Asian range before it
reverses. The London killzone has the highest trade execution for traders.

Application
To trade this concept, first of all we go to indicators on the tradingview and
search for ICT Killzone. This indicator will help us mark out the killzones on our
charts or you can simply draw a vertical line on 2am New York Time and 5am
New York Time. This Is the time window that the setup often forms.
 The pink
shaded area indicates the London Killzone and the 2 horizontal lines mark the
high and low of the Asian range.
We start our analysis from the lower timeframe like 15-minute timeframe and
see what the market is doing. In the London killzone shaded with pink
rectangle, price trades up to take the Asian high. Since we already know that
the high of the day usually form within this period and price has taken Asian
high, we will drop down to a lower timeframe like the 1minute and look for a
change of character(CHOCH) to the downside.

From the 15m timeframe, we drop down to the 1 minute timeframe so we can
know exactly were the low or high of the day is going to be.
 In the 1m
timeframe, the area circled is the point were price took the high of the Asian
range. From that point, we will start looking for a CHOCH to the downside. We
had a change of CHOCH at the point were the cursor is and that gives us the
assurance that we have shift from an uptrend to a downtrend. Next, we will
look for a FVG within the price leg that caused the CHOCH and that will be our
entry.

We
had our FVG at the area marked with a gray rectangle. We will wait for price to
return back to the FVG then we enter a sell trade.
 Our stoploss
will be at the high of the day and our take profit will target the liquidity at the
opposite side.

This is how
our trade pan out on the 15 mins timeframe. So this is basically how to use the
London killzone to take trades. The idea target is 20 to 25 pips and here we
have almost 30pips.

RECAP
Basically, what we do is that every morning, we come to our chart and ideally
select GBPUSD or EURUSD because these are the idea currencies for the
London killzone. Goto indicators and search for ICT KILLZONES. It will indicate
different KILLZONES for you. We have the Asian killzone, London killzone and
there New York killzone. But one thing about the London killzone is that it has
the high potential of forming either the high of the day or low of the day and
the time period falls between 2am to 5am NY time. Goto 15 minutes
timeframe and see what the market is doing.
Then drop down to a lower timeframe like 3 or 1 minute timeframe and look
for a CHOCH.
Once you have a CHOCH, we wait for price to come back to the FVG or an
order block before the CHOCH and enter either a buy or sell trade from there
depending on the direction of the market.