ICT Power of 3 (PO3) Entry Model: Sniper Entries with DRT — Transcript

Full transcript

1. 0:00So, I've been sharing screenshots of my
2. 0:02entries for years now. And one of the
3. 0:04most common questions that I get asked
4. 0:06is, "How do you get them so precise?"
5. 0:09And for years, I've kept that
6. 0:10information to myself. But in this
7. 0:13video, I've decided to finally lift the
8. 0:15lid on what actually constitutes a high
9. 0:18probability precision entry and how you
10. 0:21can do it, too. Firstly, these are the
11. 0:23specific things I'm looking for when I'm
12. 0:25hunting a setup. The first thing is DRT
13. 0:28levels. This gives me a framework to
14. 0:31determine where price is within the
15. 0:32range. The second thing is liquidity.
16. 0:35Now I'm always asking myself two things
17. 0:38here. Number one, what's the recent
18. 0:40liquidity pool prices left from? And
19. 0:42where's the next liquidity pool price is
20. 0:45drawing towards? This is very important.
21. 0:47The third thing is inefficiencies. And
22. 0:49again light liquidity I'm looking for
23. 0:51which is the most recent inefficiency
24. 0:53that price has left and where is the
25. 0:56nearest inefficiency that price is
26. 0:58likely to draw towards. And the fourth
27. 1:00one is arrays. I'm going to do more
28. 1:02in-depth videos for each of these. So if
29. 1:04you haven't subscribed to the channel
30. 1:06already, please make sure you do. Just
31. 1:08to recap here very briefly what DRT
32. 1:11levels are. Here is an example of a
33. 1:13price chart. Now I'm anchoring the DRT
34. 1:17levels to this specific range of price
35. 1:19where we have these highs here forming
36. 1:22the dealing range high or the DRH. This
37. 1:25is the highest price inside of a range.
38. 1:28And then down here we will have the
39. 1:30dealing range low or the DRL. Now this
40. 1:32is the lowest price of this entire
41. 1:35dealing range. Now, between the highest
42. 1:36price and the lowest price, of course,
43. 1:38we're going to have the mid price. And
44. 1:40we call this the 50 DRT level, which is
45. 1:43the fairest price between the highest
46. 1:45price and the lowest price. And often I
47. 1:47refer to this as fair value. Between the
48. 1:4950 DRT level and the DRH, we will have
49. 1:53our 75 DRT level. And between the 50 DRT
50. 1:57and the DRL, we will have our 25 DRT
51. 2:00level. Now essentially I'm looking for
52. 2:02liquidity inefficiencies and arrays that
53. 2:04overlap with these DRT levels. These DRT
54. 2:08levels are going to be remembered by the
55. 2:09algorithm as specific data points that
56. 2:12it will refer to as its delivering
57. 2:14price. These are extremely powerful
58. 2:17levels and I have many videos on this
59. 2:20YouTube channel dedicated directly to
60. 2:22DRT or dealing range theory. So I
61. 2:24strongly suggest you check them out if
62. 2:25you haven't already. But let me explain
63. 2:28how this all fits together in order for
64. 2:30us to really hunt that precise entry
65. 2:33that we're all looking for. So here we
66. 2:34have a recent chart on Euro and this is
67. 2:37on the 5minut time frame. Now it's
68. 2:39advantageous to have a higher time frame
69. 2:42narrative and a higher time frame draw
70. 2:43on liquidity. That's the most important
71. 2:45thing before you come to precision
72. 2:47entries. And again I'm going to do a
73. 2:49whole another video on this. But once
74. 2:51you have established a higher time frame
75. 2:53draw on liquidity and let's say for
76. 2:55example that before we've even come down
77. 2:57to the 5minut time frame we have already
78. 2:59established that the market is bearish.
79. 3:01It's drawing towards some sellside
80. 3:03liquidity pool below the market or an
81. 3:06inefficiency that remains open inside of
82. 3:08a discount market for example. The first
83. 3:11thing we want to do if we are bearish we
84. 3:15demand that price runs in the opposite
85. 3:18direction first. This is extremely
86. 3:21important because we want buy side
87. 3:24liquidity to be engaged and if we're
88. 3:27bearish the market is going to run in
89. 3:29the opposite direction because buyers
90. 3:31are going to FOMO into the market. We
91. 3:33never ever chase price. Now I'm going to
92. 3:35use the power of three example here as a
93. 3:38filter to determine where the higher
94. 3:40probability sells will form. Now, again,
95. 3:42we're going to be using a lot of time in
96. 3:44conjunction with these concepts, and
97. 3:46I'll explain what I mean in a second
98. 3:47here. But let's delineate 12:00 a.m. New
99. 3:51York Eastern Standard Time. When we have
100. 3:53a classic sell day, we anticipate the
101. 3:56market to run higher post 12:00 a.m.
102. 3:59before the market reverses. So, ideally,
103. 4:02we want to see the market run above the
104. 4:04opening price. If you've watched the
105. 4:06webinar on my website, you will
106. 4:08completely understand what I mean by
107. 4:09that. But let's delineate the opening
108. 4:12price here at 12:00 a.m. New York
109. 4:14Eastern Standard Time. As we can clearly
110. 4:17see, first the market drops lower,
111. 4:19creating a short-term low. Then it runs
112. 4:22higher and it consolidates over here,
113. 4:25creating a pool of buyside liquidity
114. 4:27above the market. Price raids that
115. 4:29buyside liquidity and then runs lower,
116. 4:32breaking structure here with a close.
117. 4:36This was the initial low that was formed
118. 4:38prior to London open. So it's an
119. 4:41important low. This is a key liquidity
120. 4:43pool. Notice the equal highs here were
121. 4:46raided inside of the heart of the London
122. 4:48session. And then notice with this
123. 4:50candle that we displaced lower closing
124. 4:54through the opening price. We now have a
125. 4:57few conditions met. We're anticipating
126. 4:59lower prices. First and foremost, we've
127. 5:02seen in London a buy side liquidity pool
128. 5:05raided which is above the opening price
129. 5:08and then we've seen the market displace
130. 5:11lower closing back below London's low
131. 5:14and the initial low that was created
132. 5:16post 12 a.m. This gives us a green light
133. 5:19essentially to hunt for short setups. If
134. 5:22we look closely, this is a leg that
135. 5:24breaks structure after we have raided
136. 5:26buyside here. It's again very important.
137. 5:29What we want to do is look inside of
138. 5:31that leg for a fair value gap. And we
139. 5:33see one right here. Notice how price
140. 5:35runs into the fair value gap. The
141. 5:37candles fail to close above it. And look
142. 5:40where they're stopping at that 12 a.m.
143. 5:42opening price. Also note, we have this
144. 5:45down close candle here. So we have a
145. 5:47swing high, a swing low, and then a
146. 5:51swing high that raids the pool of
147. 5:53buyside liquidity before dropping lower
148. 5:57back below the closing price of this
149. 5:59down close candle. Now we have a high
150. 6:01probability bearish breaker. Inside of
151. 6:04that breaker, we have the fair value
152. 6:06gap, which also overlaps with the 12
153. 6:09a.m. opening price. Now watch carefully
154. 6:11here. If we take the initial low and we
155. 6:14grade this range from the low to the
156. 6:16high that was created inside of that
157. 6:18London session, we can get our DRT
158. 6:21levels. So we have our dealing range
159. 6:22high, the dealing range low, the 50 DRT
160. 6:26level, the 25 DRT, and the 75 DRT. Now,
161. 6:29these are interchangeable depending on
162. 6:31where the market's moving higher or
163. 6:33lower. Now again, watch this. With this
164. 6:35down close candle, we break and close
165. 6:38through that 75 DRT level. And again we
166. 6:40have that fair value gap in close
167. 6:42proximity. We run higher touch that 75
168. 6:46DRT level and this would have been our
169. 6:48first precision entry. The draw down on
170. 6:51that is very very low. And then we see
171. 6:53the subsequent move lower all the way
172. 6:56into the New York session. Now generally
173. 6:59when we have a classic sell day we
174. 7:01anticipate the New York session to be a
175. 7:03continuation of what happened in the
176. 7:05London session. So, we anticipate some
177. 7:07form of a retracement. Since we have a
178. 7:09swing high here and a swing low down
179. 7:12here, we can grade this entire range as
180. 7:15a type one dealing range. With the type
181. 7:17one dealing range, when we are bearish,
182. 7:19we anticipate the market to move inside
183. 7:21of a premium. And ideally, we want to
184. 7:23see some sort of a liquidity pool or
185. 7:25inefficiency tapped in the premium area
186. 7:28before selling off and continuing again
187. 7:31all the way into London close. Look
188. 7:33closely here. Above the 50 DRT level, we
189. 7:36have a fair value gap here in the form
190. 7:38of a sellside imbalance. This sits
191. 7:40inside of a premium market between the
192. 7:42dealing range high and the 50 DRT level.
193. 7:45So, anything above that 50 DRT level, we
194. 7:48consider a premium price. Now, when we
195. 7:51are bearish and we have a type one
196. 7:52dealing range, we want to sell inside of
197. 7:55a premium market. To make this even
198. 7:57higher in probability, notice that we
199. 8:00have a minor buyside liquidity pool
200. 8:03above these candles to the left. Price
201. 8:05sweeps through that liquidity pool,
202. 8:07touches the discount low of the fair
203. 8:10value gap, and then drops lower one more
204. 8:12time. That would be your second high
205. 8:15probability entry. Now, I want to draw
206. 8:18your attention to this box here. And
207. 8:20we're going to zoom into this piece of
208. 8:22price action with the bodies being
209. 8:24relatively equal at the highs and
210. 8:27relatively equal at the lows. I want to
211. 8:30grade this range from the highest body
212. 8:33to the lowest body or the rejection
213. 8:35blocks. Again, watch what happens here.
214. 8:37Price runs higher, raids the minor pool
215. 8:40of buy side liquidity into that premium
216. 8:43fair value gap and then drops lower.
217. 8:46Notice the candle. this candle fails to
218. 8:49close above the rejection block or the
219. 8:50dealing range high and then we drop
220. 8:52below a breaking structure below this
221. 8:54swing low. Now inside of the leg that
222. 8:58raids liquidity and broke structure, it
223. 9:00leaves another fair value gap over here.
224. 9:03So that's going to be important in a
225. 9:04second, but watch what happens. Price
226. 9:06drops all the way down into that 75 DRT
227. 9:09level. Notice what we have at that 75
228. 9:12DRT.
229. 9:13We have these three consecutive down
230. 9:16close candles which forms one bullish
231. 9:19order block and look at the sensitivity
232. 9:21over here. Now we anticipate a reaction
233. 9:23here. So say for example we're overall
234. 9:26bearish on the higher time frame and we
235. 9:28wanted to take this as a scalp. We could
236. 9:31take a buy entry long here and we could
237. 9:33get out at the fair value gap over here.
238. 9:36Again notice this fair value gap
239. 9:39overlaps with that 25 DRT level. Let me
240. 9:42zoom back out again for a second. I want
241. 9:45to draw your attention to this down
242. 9:47close candle. This down candle rests at
243. 9:50that 50 DRT level. And this is something
244. 9:52that we typically want to see when we
245. 9:55are in low resistance liquidity run
246. 9:57conditions. And we can qualify this as
247. 9:59something known as a measuring gap. If
248. 10:01this gap forms at the halfway price
249. 10:03between the highest price and the lowest
250. 10:05price, we know that we have a valid
251. 10:06dealing range here. Also note the time
252. 10:10this fair value gap forms. It's at 5:00
253. 10:12a.m. New York Eastern Standard Time,
254. 10:14which is at the end of the London
255. 10:16session. Now, let's extend this across.
256. 10:19Notice this up close candle here that
257. 10:22dips into the fair value gap. This would
258. 10:24be your third precision entry. Note what
259. 10:27time this entry forms at 10:00 a.m. New
260. 10:31York Eastern Standard Time, which is at
261. 10:33the end of the New York session. There
262. 10:36is a timing element to when these setups
263. 10:38are going to occur, but I'll get into
264. 10:40that at a later date. Like I said, make
265. 10:43sure you're subscribing to this channel
266. 10:44because I'm giving a ton of gems away
267. 10:46here that 99.9% of the other ICT
268. 10:49educators out there just do not know.
269. 10:52I'm beginning to sound like ICT. Anyway,
270. 10:55watch what happens next. The market
271. 10:57drops lower, raiding the initial low
272. 11:00that was created inside of the New York
273. 11:02session. Now this again is a key
274. 11:04liquidity pool and then we can cover
275. 11:06those shorts again inside of that London
276. 11:09close session where we anticipate the
277. 11:12daily low to form. So the high of the
278. 11:14day is made here in London and the low
279. 11:17of the day is made here in London close.
280. 11:20It's also worth noting how that 25 DRT
281. 11:23level really nicely overlaps with the
282. 11:26opening price at 12:00 a.m. Again, this
283. 11:28is another little indication that you
284. 11:30have the right dealing range. There's
285. 11:32another dozen things I can talk about on
286. 11:34this chart, but let's keep it simple for
287. 11:37now. The point here is when you're
288. 11:40looking for high probability setups, if
289. 11:43you pair DRT levels with inefficiencies,
290. 11:46liquidity pools, and arrays, and then
291. 11:49you wait for the element of time to
292. 11:52align, this is the most powerful
293. 11:55framework that you can find for
294. 11:57precision entries. Now, don't just take
295. 11:59my word for it. I want you to go back
296. 12:01into your own charts and back test just
297. 12:03how many times this actually occurs. I'm
298. 12:06still only scratching the surface here.
299. 12:08If you want a deeper understanding about
300. 12:11algorithmic price action, dealing range
301. 12:13theory, and how I break all of this down
302. 12:16in real time, then click the link below
303. 12:18if you want to get extra coaching or
304. 12:20mentorship from me. If you're not quite
305. 12:22ready for that, then click the link
306. 12:24below to download my free ebook, A
307. 12:26Beginner's Guide to Algorithmic Price
308. 12:28Action. It's a fantastic little resource
309. 12:30to get started.