Balanced Price Range (BPR)🔥 The Key to Smart Money Entries! SMC | ICT — Transcript

Full transcript

1. 0:00[Music]
2. 0:08Hello traders, welcome back to the
3. 0:11channel. Take a look at these three
4. 0:12figures. Can you identify what these
5. 0:15highlighted areas are and how they are
6. 0:17different? Just write down your answers
7. 0:19in the comment box.
8. 0:26So the first figure shows a fair value
9. 0:29gap. The second one displays an inverse
10. 0:32fair value gap. And the last figure
11. 0:35portrays a balanced price range. Now if
12. 0:38you have got all three right, congrats.
13. 0:41At this point, most of you will have a
14. 0:44good understanding on what a fair value
15. 0:46gap and inverse fair value gap is. What
16. 0:49is left is the balanced price range. So
17. 0:53in this video we are going to learn
18. 0:55exactly that. I will help you understand
19. 0:57what balance price ranges are, their
20. 1:00formation, identification as well as
21. 1:02their use in the market. Balance price
22. 1:05range or BPR is one of those critical
23. 1:08concepts that can aid your understanding
24. 1:11of the market and help you find trade
25. 1:13opportunities. This is a very useful SMC
26. 1:16concept that can complement your trade
27. 1:18entries. So watch this video till the
28. 1:21end to get a proper grasp over the
29. 1:23entire concept. Make sure you like this
30. 1:26video and if you haven't subscribed to
31. 1:28the channel yet, please make sure to
32. 1:30subscribe. So without further delays,
33. 1:32let's get going. We will begin with
34. 1:35defining what a balanced price range is.
35. 1:38So a balanced price range is a concept
36. 1:41closely related to fair value gaps. To
37. 1:43understand a balanced price range, you
38. 1:46need to have a decent idea on what a
39. 1:48fair value gap is. I have talked about
40. 1:50fair value gaps and imbalances in
41. 1:53multiple videos. I recommend anyone with
42. 1:56zero knowledge on fair value gaps to
43. 1:58watch the second episode of the first
44. 2:00season of the SMC course. Please go back
45. 2:03and watch that video before proceeding
46. 2:05with this episode. A balanced price
47. 2:08range or BPR in SMC trading refers to a
48. 2:12specific market condition where the
49. 2:14price exhibits a quick upward movement
50. 2:17followed by an equally rapid downward
51. 2:19movement or vice versa where there is a
52. 2:22quick drop in the price followed by a
53. 2:24rapid upward movement. These rapid price
54. 2:27movements leave behind imbalances in
55. 2:30price action. More specifically, a
56. 2:32balanced price range is the area on a
57. 2:34price chart where two opposite fair
58. 2:37value gaps overlap. In this case, you
59. 2:40can see a bearish fair value gap
60. 2:42formation after which the price retraced
61. 2:45back strongly forming a bullish fair
62. 2:48value gap on the way up that overlaps
63. 2:50with the bearish fair value gap.
64. 2:52Similarly, this is another case where a
65. 2:55bearish fair value gap overlaps with a
66. 2:58bullish fair value gap on the way down.
67. 3:00Just like normal fair value gaps, when
68. 3:02the price revisits these areas, price
69. 3:05often reacts strongly, making the
70. 3:08balanced price range a crucial area of
71. 3:10interest for trading. Normally, the
72. 3:13price fills this gap before moving in
73. 3:15the same direction as the last price
74. 3:17movement. For instance, in this case,
75. 3:20price could come back and fill the
76. 3:22balance price range formed and then
77. 3:24continue to move higher. Now you could
78. 3:26ask me why is this concept important and
79. 3:30why should you learn this? Well, the
80. 3:32importance of a balanced price range
81. 3:35lies in its sensitivity towards market
82. 3:38price movement. When the market
83. 3:40approaches a BPR, it often results in a
84. 3:43quick and significant price reaction.
85. 3:46Before continuing a market movement, the
86. 3:48market frequently retest the BPR. This
87. 3:51retest is a critical moment for traders
88. 3:54to identify potential entry and exit
89. 3:56points. This price reaction is primarily
90. 3:59due to the presence of two overlapping
91. 4:01fair value gaps which attracts the
92. 4:04attention of a lot of smart money
93. 4:05traders who can influence market
94. 4:08direction. ICT SMC is a very popular
95. 4:11trading strategy especially in the forex
96. 4:13markets. So their actions in these areas
97. 4:16can significantly impact market
98. 4:19direction. Now let's move ahead and
99. 4:22learn to identify a BPR properly.
100. 4:25Basically identifying a balanced price
101. 4:27range on any chart involves two key
102. 4:30steps. As I have mentioned earlier, this
103. 4:33process involves recognizing fair value
104. 4:36gaps on both the buy and sell sides of
105. 4:39the price. So start by identifying a
106. 4:41fair value gap on the sell side of the
107. 4:43price. As you might have already
108. 4:46guessed, this bearish fair value gap
109. 4:48will appear when the price drops
110. 4:50quickly, leaving an imbalance between
111. 4:53the lowest price of the first candle and
112. 4:55the highest price of the third candle.
113. 4:57Next up, find a fair value gap on the
114. 5:00buy side of the price when the market
115. 5:02rises rapidly, creating a similar
116. 5:05imbalance. Once you have marked both the
117. 5:07fair value gaps, the second step
118. 5:10involves looking for a common area where
119. 5:12these two fair value gaps overlap
120. 5:14horizontally. This overlapping zone is
121. 5:18known as the balanced price range. It is
122. 5:20the region where the bullish and bearish
123. 5:23fair value gaps coincide thereby
124. 5:25indicating a balance between supply and
125. 5:28demand at that price level. This
126. 5:30indicates efficient price delivery,
127. 5:32meaning that the market has effectively
128. 5:35filled the imbalance and is likely to
129. 5:37respect this BPR area as a strong
130. 5:40support or resistance zone. Now, just
131. 5:43like the other SMC zones, the BPR also
132. 5:46has two types. There is a bullish and a
133. 5:49bearish BPR. Let's quickly take a look
134. 5:52at each one of them and understand how
135. 5:54we can use them for our trades. We will
136. 5:56begin with a bullish BPR. A bullish
137. 5:59balance price range is identified on the
138. 6:02buy side of the price and it acts like a
139. 6:05region of support for future price
140. 6:07movements which can be used by traders
141. 6:09to enter into long trade positions. Now
142. 6:12let's figure out how to take trades
143. 6:14using a bullish BPR. So to trade a
144. 6:17bullish BPR, you have to look for
145. 6:20bullish market structure on your higher
146. 6:22time frame chart where the price is
147. 6:24forming higher highs and higher lows.
148. 6:26This higher time frame will depend on
149. 6:28your trading style. It could be 1 day, a
150. 6:314 hour or a 15 minutes or any other time
151. 6:34frame. Let me consider a 15-minut chart.
152. 6:37The second thing you need to look for is
153. 6:39a bullish PDA within this higher time
154. 6:42frame bullish price leg. This could be a
155. 6:44bullish fair value gap, a bullish order
156. 6:47block or any other area of value where
157. 6:49the price could form a strong rejection.
158. 6:52Now if this internal range liquidity is
159. 6:54found within the discount zone the
160. 6:56better it is. Now when the price
161. 6:58approaches the bullish PDA you need to
162. 7:01switch to your lower time frame chart
163. 7:03for identifying a market structure shift
164. 7:06in this time frame. Here I have
165. 7:08considered a one minute chart to see
166. 7:10whether there is a market structure
167. 7:12shift from bearish to bullish. After you
168. 7:15identify a market structure shift, look
169. 7:17for a bullish fair value gap which is
170. 7:20overlapping with a bearish fair value
171. 7:22gap. Now mark the overlapping area. This
172. 7:25is the bullish BPR that we are looking
173. 7:27for. Now wait for the price to test to
174. 7:30this BPR area before you execute a long
175. 7:33trade entry. You can place a buy limit
176. 7:35order at the high level of this BPR or
177. 7:38you could take a limit entry at the
178. 7:4050%age of this BPR level. You can set
179. 7:43the stop loss below this BPR or you
180. 7:46could place it below the recent swing
181. 7:47low formed before the LTF market
182. 7:50structure shift. For setting your profit
183. 7:52targets, switch back to your higher time
184. 7:54frame and place your target near the
185. 7:57next draw on liquidity. A similar
186. 7:59approach is applicable for trading
187. 8:01bearish BPR. Let's quickly look at this.
188. 8:04So a bearish balance price range can be
189. 8:07identified on the sell side of the price
190. 8:10and it can be used by traders to
191. 8:12initiate sell trades or short positions.
192. 8:15Just like the previous case, in order to
193. 8:17trade a bearish BPR, first you need to
194. 8:20look for a bearish market structure on
195. 8:23your higher time frame chart. Secondly,
196. 8:25you need to identify a bearish PDA like
197. 8:28a bearish fair value gap, bearish order
198. 8:31block, etc. within the higher time frame
199. 8:33bearish swing leg. It is better if this
200. 8:36internal range liquidity gets formed in
201. 8:38the premium zone of this price swing.
202. 8:41Anyways, when the price approaches this
203. 8:43bearish PDA, you need to switch to your
204. 8:46lower time frame structure. Then you
205. 8:48need to check for a market structure
206. 8:50shift from bullish to bearish. Now if
207. 8:53you identify such a shift in structure,
208. 8:55I need you to look for a bearish fair
209. 8:58value gap which overlaps with a bullish
210. 9:00fair value gap. This overlapping region
211. 9:03is our bearish BPR. Now you have to wait
212. 9:06for the price to test this BPR area
213. 9:09before you execute a short trade entry.
214. 9:12You can place a sell limit order at the
215. 9:14low level of this BPR zone or you could
216. 9:17take a limit entry at the 50%age of this
217. 9:19BPR level. You can set the stop- loss
218. 9:22above this range. Or you could place it
219. 9:24above the recent swing high formed after
220. 9:26the lower time frame market structure
221. 9:28shift. For setting your profit targets,
222. 9:30switch back to your higher time frame
223. 9:32and place your target near the next draw
224. 9:35on liquidity. I hope things are clear.
225. 9:38So this is all you need to know about
226. 9:40balanced price ranges and in the next
227. 9:43episode I will talk about the power of
228. 9:45three concept which is a very common
229. 9:48strategy that smart money uses to
230. 9:50manipulate retail traders and hunt their
231. 9:52positions. So stay with us to find out.
232. 9:55Meanwhile, if this video was
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245. 10:22Till then, bye.