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The 3 Step A+ Strategy I Use Everyday — Transcript

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0:00You've been trading for a year, maybe
0:01two. Every 3 weeks you're back on
0:03Twitter looking for a new strategy
0:05because the last one hit a losing streak
0:07and you couldn't sit through it. Sunday
0:08night you print fresh rules, Monday
0:10morning you break them by 10:00 a.m.
0:12You've probably spent five, maybe 10
0:14grand on courses trying to fix this, but
0:16that's not the fix because the problem
0:17was never the strategy. The problem is
0:19you can't sit through the losing streaks
0:21that come with every real one. And every
0:223 weeks you switch to a new strategy
0:24that hasn't hit its losing streak yet.
0:26That's the whole loop you're stuck in.
0:28And that's what's actually been costing
0:29you the account. So, in this video I'm
0:31going to do two things for you. I'm
0:32going to give you the three-part
0:33framework I've been running for the past
0:355 years that made me millions of
0:36dollars. And more importantly, I'm going
0:38to tell you why you're going to struggle
0:39to stick to this one, too, and exactly
0:41what fixes that. But first, let's talk
0:43about what you need to understand before
0:45you take another trade this week.
0:46Starting off with daily bias, which is
0:48the direction institutional flow has
0:50already decided the market wants to
0:52deliver price today. Bullish, bearish,
0:54or neutral. And here's the thing that
0:55most retail traders never accept. The
0:57direction was decided before you sat
0:59down. Now, your job is not to guess it.
1:01Your job is to read it. And you form
1:03this bias before the open using two
1:05questions I'll walk you through in just
1:07a second. Now, if you come to a
1:08conclusion of which direction you're
1:10trying to trade before you start trading
1:12for that session, that's going to be
1:13your side and you should stick to it. If
1:15you have conflicting information or the
1:16market is more neutral, then you should
1:18sit out. There is no option where you
1:20should be trading because you wanted to
1:22force it. Now, our daily bias is a lean.
1:24It's not a prediction. Developing a bias
1:27is only answering one question. Which
1:30side am I willing to be on today? And
1:31you form this based on a higher time
1:33frame or what you're analyzing before
1:35the session starts. It's going to help
1:37you filter your trades, but it doesn't
1:39generate them. And one thing that's
1:40helped me a lot is not switching my bias
1:42in the middle of a session. Now, if
1:44you're an intraday trader and you like
1:45trading the AM session and the PM
1:47session, let's say if you get the bias
1:49wrong in the morning, then maybe in the
1:51afternoon you can decide to flip your
1:52bias, but I typically would not
1:54recommend doing it in the middle of a
1:55session because you can get into a lot
1:57of bad situations. It causes revenge
1:59trading, it causes tilt, and sometimes
2:01it makes you oversize the position
2:03trying to make back the initial loss.
2:05And because markets are probabilistic in
2:07nature, being wrong about your bias is
2:09totally normal. But if you're not
2:10comfortable admitting you were wrong,
2:12then it ends up being an expensive
2:14mistake. Now, how do I determine my
2:16actual bias? Well, first, it's going to
2:17start top-down, meaning I have a higher
2:19time frame that I'm trying to read,
2:21whether that's the daily, the 4-hour, or
2:23the 1-hour. And I'm trying to analyze if
2:25the market is making higher highs and
2:27higher lows or lower highs and lower
2:29lows. And also, do we have a target in
2:31mind that the market should trade to?
2:33So, I ask myself three questions. Which
2:35way is the daily or the higher time
2:37frame delivering? That could be the
2:384-hour or 1-hour, whatever your highest
2:40time frame is going to be for that
2:42specific trading session. Is it creating
2:43higher highs and higher lows or lower
2:45highs and lower lows? Are we getting
2:47inside candles showing us the market is
2:48neutral, or are we getting outside
2:50candles showing us strong participation
2:52in the market? Question number two, what
2:54has not been taken yet? So, I'm looking
2:55for untouched highs and lows above or
2:58below, depending on which direction my
2:59bias is. So, if I have a bullish bias
3:01coming into the day, I prefer the
3:03previous daily highs are not taken yet
3:06because that gives me a target to reach
3:07for. And if I'm bullish, but the
3:09previous daily high's already been
3:10taken, then I either size down or I
3:12don't take a trade because my target's
3:14already been met. And finally, number
3:16three, I always have a point of
3:18invalidation, meaning my stop loss. I
3:20always pick this level in advance, and
3:22it's my invalidation level. So, if price
3:24trades through it and holds, my bias is
3:26dead because my stop goes into a place
3:28where the trade idea is no longer right.
3:30And the best protocol that I found is
3:32once my invalidation level's hit for the
3:34day, then I'm done. I do not flip on an
3:36impulse. So, everybody talks about bias,
3:38but a lot of traders have a hard time
3:40actually implementing it and what to
3:42look for. So, let's walk through a
3:43couple cheat sheets that I put together.
3:45In both of these examples, they're
3:46showing strong bullish moves. So, in
3:48this top example, we have a higher low
3:51and higher high, and the close of this
3:53candle closes above the previous high.
3:55So, we have two candles in sequence that
3:57create a higher low and higher high and
4:00it's closing above the previous candles
4:02high. This is showing us that bulls are
4:04in control. Now, we also have outside
4:06bars where the second candle takes out
4:08the previous candles low and also closes
4:11above the previous candles high. And we
4:13can see that the second candle fully
4:15engulfs the previous candle. This is
4:17another strong indication that bulls are
4:19fully in control of this market. So, we
4:20have two examples of strongly bullish
4:22scenarios where we only need two candles
4:24to try and predict what that third
4:26candle's going to try and do. This gives
4:28me a strong conviction that the market
4:29is bullish. So, what I'm trying to do is
4:31only look for buying opportunities.
4:33[music] And you've probably noticed this
4:35in your own trading. You see bearish
4:36setups when the higher time frames were
4:38telling you it's bullish and all of
4:39those bearish setups fail and you end up
4:41taking losses. So, when I have that
4:43conviction coming from the higher time
4:45frame, whether it's a daily, the 4-hour
4:47or the 1-hour, I want to make sure I'm
4:49aligned with that. So, when I drop down
4:51to my execution time frame, whether
4:52that's the 15-minute, the 5-minute or
4:54the 1-minute, that I'm trading in
4:56alignment with that higher time frame.
4:58Now, the next one is going to be a weak
4:59bullish setup. And in this case, we have
5:01a higher low and higher high, but in
5:03this case, candle number two fails to
5:05close above the previous candle's high.
5:07While this specific pattern is still
5:09bullish, I'm much more cautious because
5:11we could see some type of retracement.
5:13Even though this example is still
5:14bullish, I am much more cautious because
5:16I am weary of a deeper retracement prior
5:18to seeing those buy signals appear. So,
5:20again, you're trying to long but with
5:22caution. Next, we have strong bearish.
5:24And in this example, you could see that
5:25the market is creating lower highs and
5:27lower lows and we are also closing below
5:30the low of this previous candle. Now,
5:32again, this all depends on the higher
5:34time frame that you're using for your
5:36trade ideas. If you're using an hourly
5:38chart for your higher time frame and
5:39you're executing on the 5-minute, you
5:41really only care what happened in the
5:42last couple hours. So, let's say leading
5:44up to to open, we have this specific
5:46setup. Coming into the open, we're
5:48anticipating some smaller retracement.
5:50We're trying to position ourselves short
5:51for another expansion lower on that
5:53third candle. And in pattern number two,
5:55we also have a bearish outside bar,
5:57where it's taking out the high and
5:58closing below the low. And you could see
6:00again that this specific candle is
6:02engulfing or outside of the previous
6:05candle. So, both of these examples give
6:07me a strong conviction for bearishness.
6:09So, even when I drop down on those lower
6:11time frames, I'm only looking for
6:12reasons to short the market. If I drop
6:14down to a lower time frame and I'm
6:16seeing bullish setups, well, I'm just
6:17going to wait until a bearish setup
6:18appears. Next up, we have weak bearish.
6:21So, this market is creating lower highs
6:23and lower lows, but this second candle
6:25fails to close below the low of this
6:27first one. Now, I'm only shorting this
6:29with caution because there is the chance
6:31that this market is going to provide a
6:32deeper retracement prior to finding that
6:35short signal. Then, we have caution
6:36candles, and these signal either a
6:38reversal or retracement is underway. So,
6:41as you can see in this top example, the
6:42market did create a higher low and
6:45higher high, but you can see that the
6:46second candle closed bearish, meaning it
6:49failed to continue higher and it gave us
6:51a bearish rejection. And in our bullish
6:52example, we can see the market is
6:54creating lower lows and lower highs, but
6:56the market failed at the previous
6:58candle's low and gave us a bullish
7:00closure. So, for our conviction, it's
7:02low for a continuation, meaning if we
7:05get a higher low and higher high, my
7:06conviction is very low that the market's
7:08going to continue higher, and it's
7:10actually higher for a reversal or
7:12retracement. These two examples give us
7:14our early warning signs of a possible
7:16turn in the market. And lastly, we have
7:18our neutral candles or inside candles.
7:21So, in this top example, we see that
7:22this candle closed inside of the
7:25previous candle and did not create a
7:27higher high or a lower low. It's the
7:29same thing if you see a bullish inside
7:31candle, it failed to create a higher
7:33high and it failed to create a lower
7:35low. This two-candle pattern is telling
7:37us that the market is indecisive in that
7:39current moment. And what we're trying to
7:41do is wait for a break. Now, a break can
7:43come in the form of a fake out, meaning
7:45it takes out the candle's high and then
7:47reverses, or we might get a break to one
7:49side and a continuation. But usually
7:51when these candles appear, I'm sitting
7:53on my hands waiting to see what happens.
7:55Now, knowing the bias is just step one
7:57because the market doesn't just go where
7:58we want in a straight line. It has to
8:00run something first. And when you
8:01understand what that is, every losing
8:03trade you took the last month is going
8:05to make sense in about 30 seconds. And
8:07that's because your stops are what the
8:08market is chasing. So, every visible
8:10swing high on your chart, that's where
8:12buy stops are resting. And every swing
8:14low, there's sell stops sitting below
8:16that. Those are our pools of liquidity,
8:18and the professionals know exactly where
8:20every single one is. And they need to
8:21know this because they need counter flow
8:24to enter their positions. So, for every
8:26buyer, there's a seller. And for every
8:28seller, there's a buyer. What
8:29professionals are trying to do is
8:30position themselves where the most
8:32transactions are occurring. So, if the
8:34market is bearish, they're going to use
8:36buy stops to try and enter their
8:38positions because they know a bunch of
8:40old highs, there's going to be a lot of
8:42liquidity and trading activity occurring
8:44above that old high. So, professionals
8:46are using that flow to fill their orders
8:48and then reverse it and go the actual
8:50direction they want to take the market.
8:52So, yeah, that move that stopped you out
8:53this morning before ran to your target,
8:55that's because you were the counterparty
8:57to their trade. So, when we think about
8:58a market, we have all of these pending
9:00orders that are being placed in the
9:02market. Whether it's traders that are
9:03sidelined trying to get into the market
9:05or traders that have active positions
9:07using stops and limits to protect the
9:10position and take profit. So, above
9:12obvious highs sit buy stops and below
9:14obvious lows sit sell stops. Again, a
9:17large order needs someone to take the
9:19other side. Now, equal highs and equal
9:21lows are the clearest pools because as
9:24that market approached its previous high
9:26and didn't take it out, more and more
9:28liquidity is being built up above that
9:30high. And same for equal lows or double
9:32bottoms. As the market approached that
9:34level, it didn't take out this liquidity
9:36on its first visit. So, when it rallied
9:38away, more and more orders are being
9:40built up below those lows. Now, if
9:42you're having a hard time spotting where
9:44liquidity is, it can be very simple. All
9:46of these orders stack at very obvious
9:48levels, meaning previous weekly highs
9:50and lows, previous daily highs and lows,
9:53and previous session highs and lows.
9:54Now, you would have noticed this if you
9:56study this for any meaningful time.
9:58Often times when we take out weekly
10:00highs and lows, there is a very, very
10:02strong reaction at those levels. Either
10:04we get a reversal or we get a break
10:05through and a continuation. Then we have
10:07daily highs and lows, and these are our
10:09default target for the session. Meaning,
10:11if I'm bullish, I'm targeting a previous
10:14daily high. And if I'm bearish, I'm
10:15targeting a previous daily low. I'll
10:17mark them every morning, and again, if
10:19I'm bullish and we've already taken out
10:21a previous daily high, I'm much less
10:23likely to put on excessive risk because
10:25my target's already been met. And then
10:27finally, we have session highs and lows.
10:29So, we have Asian session, London
10:30session, and New York session. These are
10:32typically the intraday levels that we're
10:34trying to hunt for our setups. Now, once
10:36you see this, you can't unsee it. Well,
10:38that leaves one question. How do you
10:39know in real time the sweep is done and
10:42the reversal's on? Because if you enter
10:43too early, you get chopped up. And if
10:45you enter too late, the trade's already
10:47gone. Now, there's one specific candle
10:48pattern that tells you it's a good
10:50trade. And that is the swing failure
10:51pattern. And it's exactly what it sounds
10:53like. Meaning, price approached to swing
10:55point, it took the swing point out, but
10:57failed to displace any further. That
10:59characteristic is all you need to
11:01understand the previous two concepts we
11:02just talked about. It's showing you that
11:04the bias is in play, and it's showing
11:06you where liquidity was taken and the
11:08counterparty stepped in. So, what is a
11:10swing failure pattern? I'm going to give
11:11you guys a bearish example. So, we have
11:13a prior swing high that's being raided
11:15and closed back below. So, here we can
11:17see we have this prior swing high, we
11:19take it out, but then fail to close
11:21above that specific level. Now, it's
11:23telling us two things. That buyers were
11:25given the breakout, meaning as price
11:27traded above this high, there were a lot
11:29of people trying to buy long on a break
11:31of this previous swing high. But, also
11:33there were previous sellers that may
11:34have gone short on one of these candles
11:36that put their stop loss above this
11:38specific high. So, we have early shorts
11:40being stopped out of the market, and we
11:41have buyers being trapped in the market.
11:43And that's enough liquidity to send the
11:45market the opposite direction. So, what
11:47we're looking for in a bearish scenario
11:49where our bias is bearish, we're looking
11:51for a previous swing high to be taken
11:53out, a failure at that previous swing
11:55high, and a closure back below it. Now,
11:57what separates a good swing failure
11:59pattern from a coin flip? Well, first of
12:00all, it happens at a level that actually
12:03matter. So, a weekly swing high, a
12:05session swing high, equal swing highs,
12:07not just some random swing high that
12:09happened mid-day. Number two is the
12:10direction. Is it pointing in the
12:12direction of our bias? So, if you got a
12:14bearish swing failure pattern, but your
12:15bias is bullish, it's very likely that
12:17it's going to fail. And finally, the
12:19reaction. Did it reject quickly or did
12:21it kind of take out that level and just
12:23drift? What we're looking for is a
12:25strong, quick reaction after taking out
12:27these swing highs and lows. So, now how
12:29do we put all of this together and
12:30actually trade it? Well, let me show you
12:32right now. So, the first thing that I do
12:33when I sit down in front of my charts is
12:35I go over my higher time frame to find
12:37my bias. And in this specific example, I
12:39can see the daily time frame was an
12:41inside candle. So, if we just zoom in
12:43here, we can see that this specific
12:44candle closed inside of the range of the
12:47previous candle. So, this one candle
12:49right here is an inside candle. It
12:51didn't create a higher high or a lower
12:54low. So, right now the market is
12:55neutral. And as I mentioned, what we're
12:57looking for is either a run on either of
12:59these levels to give us an indication
13:01that the market wants to continue lower
13:03or we might break out of this high and
13:05continue higher. So, right now the
13:06market is neutral. Now, what I'm going
13:08to do is plot out my previous daily high
13:11and my previous daily low. So, our first
13:13two steps are out of the way. That took
13:15me literally 2 minutes to do. Now, what
13:17we're looking for is a swing failure
13:18pattern at one of these levels and
13:20targeting the opposing level. So, we're
13:22going to drop down here and see what we
13:24get as we we forward towards the next
13:26day. All right, we're still within the
13:28range of that previous day, and we are
13:30approaching New York session. Now, here
13:31we can see that we've taken out the
13:33prior day high and closed back below it.
13:36This here is our swing failure pattern.
13:38So, we have a swing failure pattern at
13:40the previous daily high, and not only
13:42that, the hourly candle is giving us a
13:45bearish outside bar. So, you can see
13:47that we took out the previous candle's
13:49high, and we took out the previous
13:50candle's low. Now, for it to be an
13:52outside bar, it doesn't need to close
13:54below the low. All it needs to do is
13:56take out the previous high and the
13:58previous low. That way, these upper and
14:00lower wicks are outside of the previous
14:02candle. Now, I do want to note that the
14:04body of the candle should be pretty big.
14:06It should not close near the open. So,
14:08what we're going to do here, because
14:10this is our confirmation, it's telling
14:12us that people that were short got
14:13stopped out, and anybody that tried to
14:15go long on a breakout is now trapped.
14:18All right, so, what I like to do is
14:19actually just draw a rectangle here and
14:21visualize all the participants that were
14:23transacting above of this old swing
14:25high. Right? There are a pool of traders
14:28that are up here that are either getting
14:29stopped out or trapped in long
14:31positions. Now, yes, you can be the
14:33person that's in here trying to act as
14:35the counterparty, but I'm not trying to
14:37do that. I'm trying to get on side with
14:39the bigger players. So, now that I know
14:41there's bigger players operating above
14:43that high, what I can do, because I'm
14:44leaning more bearish, because if I go to
14:46the daily time frame, we're trading also
14:48into a daily fair value gap, my target
14:50is then the previous daily low. So, what
14:53I'm going to do is put on a short
14:54position and put my stop above the high
14:56that created the swing failure pattern.
14:58What I'm going to do is target the
15:00previous daily low. So, I'm going to
15:01sell short here, put my stop at
15:0330,144.50,
15:06and my target at 29,108.25.
15:09We can see that I'm taking $3,500 of
15:11risk to make $17,000. Now, I don't know
15:14if I'm going to hold this trade all the
15:16way down to the previous lows, but if it
15:18gets close enough, you could also
15:19partial and adjust your stops. So, now
15:21that we have the position on, let's play
15:22this forward and see what happens. So,
15:24we get a very large expansion lower.
15:26Now, because my target is again previous
15:28daily lows, I'm just going to hold this
15:30one and maybe move my stop closer to
15:32break even, and I'll use this previous
15:34hourly high as my stop loss. So, I have
15:36most of the risk off the table. And
15:38there we go. Now, this trade moved
15:39extremely quickly, and I don't want you
15:42guys to anticipate that this is going to
15:43happen on every specific trade. But, the
15:45framework we talked about is there. When
15:47you get an inside candle, you're waiting
15:49to see what happens at the extremes of
15:51that inside candle. Here, we get a swing
15:53failure pattern, and then we're
15:54targeting the previous daily low. We get
15:56a very strong expansion down towards our
15:58target in the next couple hours. Now,
16:00let's just walk through the next day.
16:01Here, we can see we have a bearish
16:03outside bar because we took out the
16:05previous day's high and the previous
16:07day's low. And we got a bearish closure.
16:09Although, it's not the best bearish
16:10closure cuz I typically like to see a
16:12closure through the open of the previous
16:14candle, this one is pretty sufficient
16:16because we traded into a daily fair
16:17value gap and rejected. So, what I'm
16:19looking for is more bearishness coming
16:21into the next day. And what am I looking
16:22for again? I'm looking for another swing
16:24failure pattern. And when markets are
16:25really bearish, I don't anticipate the
16:27previous day's high to be taken out. So,
16:29in this case, I'm going to look for
16:30session liquidity. So, at midnight, we
16:33have our Asian session high. So, I'll
16:35mark that out and see if we get a swing
16:37failure pattern here. Now, we're just
16:38going to skip forward to our New York
16:39session and see what the market gives
16:41us. All right, we don't have a raid on
16:43that session liquidity just yet, but
16:44we'll keep playing it forward. Now,
16:45here's our PM session window. This
16:48candle closes at 3:00 p.m. And this
16:50candle is also a swing failure pattern.
16:52So, we have another swing failure
16:53pattern here, and as I mentioned on
16:55those bias cheat sheets, what I'm
16:57looking for in a two-candle pattern,
16:59this is a caution and reversal because
17:01we take out the previous candle's high
17:02and close bearish. So, what I'm going to
17:04do during the PM session is go short.
17:06Maybe I'll put my stop loss right around
17:08here and aim for a 2R. So, I'm going to
17:10go short. I'm going to put my stop at
17:1229457,
17:13and my take profit at 28656. Because
17:16it's so late in the day, I don't know if
17:17we're going to get that run to the
17:19previous daily low. Well, let's sell
17:20short and see what happens. So, here's
17:22about 4:00 p.m. where the market is
17:23typically closing. Now, if you wanted to
17:25tighten up the risk reward a little bit,
17:26you could drop down to the 5-minute and
17:28see if we get a swing failure pattern or
17:30something in here to position yourself
17:31short. Now, if you're trading with prop
17:33firms, they don't allow you to hold
17:34overnight, but what you can do is wait
17:35out the hour rollover and just put on
17:38another position exactly where you had
17:40your stop and your take profit
17:41initially, as long as the market doesn't
17:43gap too much. So, let's say I had to
17:45close this trade on my futures prop firm
17:46accounts, I could reopen it at 6:00 p.m.
17:48We get more continuation to the
17:50downside, and eventually we hit the
17:51target. Three things: bias, liquidity,
17:53swing failure patterns. That's the whole
17:55framework. You form the bias before the
17:57open, you wait for the market to run the
17:59opposing liquidity, when the sweep
18:00prints an SFP, you take the trade with
18:02your stop above or below the wick, and
18:04you target the next opposing pool. But,
18:06here's the actual reason I made this
18:08video. In 1983, two commodities traders
18:10ran an experiment to see if trading
18:12could be taught. They took 23 novices
18:14off the street, gave them all the exact
18:16same mechanical rule set, put them in
18:18the market with real money, same rules,
18:20same markets, same time period. Some of
18:22those traders made 100% a year for 3
18:24years straight, while others washed out
18:26completely. Same rules, wildly different
18:29outcomes, which brings me right back to
18:30what I told you before. Knowing the
18:32framework and running the framework for
18:34the 100 trades it takes to prove the
18:36math are two completely different games.
18:38And that's the game you're going to lose
18:39if you do this alone. The traders who
18:41made money and the traders who washed
18:42out weren't split by intelligence or
18:44talent. They were split by whether they
18:46had someone holding them accountable to
18:48running one framework long enough for
18:50the math to show up. That was the
18:51difference. And that's the trap that
18:52most retail traders never get out of.
18:54It's not a knowledge gap, it's an
18:56accountability gap. And that's why I
18:57created the Trading Apprentice. You get
18:59to trade this exact framework with me
19:01live. You get access to me to ask me any
19:04question you want. And more than any of
19:05that, you get held accountable to
19:07actually stick to the plan long enough
19:09to prove the edge. Now, most traders
19:10quit at trade 30, but we don't let you.
19:13So, if you're interested, I'll leave a
19:14link in the description to apply. Some
19:15of our students have gotten results like
19:17this and this. And some of them have
19:19even made $100,000 in a single month.
19:21But, I want to be very clear. We don't
19:23just accept anyone. So, if there are
19:24spots available, just submit an
19:26application and we'll see if you're a
19:27good fit. But, if you decide that's not
19:29for you, I hope this framework that I've
19:31shared will get you on the right path to
19:32success. Don't forget to like and
19:34subscribe, and I'll see you guys in the
19:35next one.

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