The Confirmation Model — Transcript

Full transcript

1. 0:03This is what it looks like from 10,000
2. 0:05ft. The checklist we need to have in
3. 0:07order to confidently enter a trade in
4. 0:09the market. A liquidity sweep that
5. 0:11happens inside of OTE. Delivering from a
6. 0:14higher time frame fair value gap. Put in
7. 0:16an SMT. Get an internal liquidity sweep.
8. 0:19Inverse a fair value gap. See a change
9. 0:21in the state of delivery with a clear
10. 0:23draw targeting opposing liquidity. We
11. 0:26enter the trade. We set our stop-loss.
12. 0:28and we let the trade play out. Here's
13. 0:30what that looks like as a bearish
14. 0:32example. We've come back up into the OTE
15. 0:35range where we've then swept liquidity.
16. 0:37We've put in an SMT at these highs,
17. 0:40tapped into a higher time frame, fair
18. 0:42value gap, had an internal sweep of
19. 0:44liquidity. We then get a fair value gap
20. 0:46that is inversed, a change in the state
21. 0:48of delivery, and we enter our trade
22. 0:50either here or at the pullback of the
23. 0:52change in the state targeting opposing
24. 0:55liquidity.
25. 0:57Here's a fair value gap that we can see
26. 0:59on the 1 hour time frame. Let's mark
27. 1:02that
28. 1:04and then let's plot our OT.
29. 1:10So, as you can see, we have put in a
30. 1:12fair value gap in this OT range here.
31. 1:16Now, I'm going to zoom in to the
32. 1:19fiveinut time frame. Here's our one hour
33. 1:23fair value gap and here is the range
34. 1:26that we plotted.
35. 1:31So let's look at our checklist liquidity
36. 1:34sweep. Well, we've had we're going to
37. 1:38jump down to the one minute now.
38. 1:42Uh we're going to move this over here
39. 1:44just so it's not in the way. We've had a
40. 1:47liquidity sweep. Let's mark that as buy
41. 1:50side liquidity.
42. 1:53What's next? OTE. We are in as we
43. 1:56discussed OTE. This range right here of
44. 1:59the previous dealing range.
45. 2:03Delivering from a higher time frame. As
46. 2:05we noted, we have we are delivering from
47. 2:08a 1 hour time frame. That just means
48. 2:10that there's a higher time frame fair
49. 2:12value gap that we have tapped into. In
50. 2:15this case, we've tapped into it in this
51. 2:17whole area and it seems to be holding.
52. 2:19We have not inverted it. It is being
53. 2:21respected.
54. 2:23SMT.
55. 2:25So, here's our liquidity on NQ. And at
56. 2:28that same time on ES, we also swept
57. 2:31liquidity.
58. 2:33So, no SMT there. And if we're to look
59. 2:35here, we'll see that we have swept
60. 2:37liquidity on NQ, but we have not swept
61. 2:41liquidity
62. 2:42on ES. So this is our SMT
63. 2:48internal liquidity sweep. So in this
64. 2:51case we have in fact had an internal
65. 2:53liquidity sweep
66. 2:57simply means that after we swept the buy
67. 2:59side liquidity here we created new
68. 3:03liquidity and quickly came up and took
69. 3:06that.
70. 3:07So, we've had liquidity sweep, tapped
71. 3:10into a higher time frame fair value gap,
72. 3:14put in an SMT, had an internal liquidity
73. 3:17sweep,
74. 3:19created a fair value gap that we have
75. 3:22now inversed
76. 3:29and then
77. 3:34get a change in the state of delivery.
78. 3:37We can enter our trade here. Set your
79. 3:41stop loss to this high here with your
80. 3:45takerit
81. 3:47down here for a nice 4.43 risk-to-reward
82. 3:51trade. Uh, and let's see if we were to
83. 3:54enter there,
84. 3:56right? With pull back to the change of
85. 3:57the state
86. 4:03and you would hit your first take profit
87. 4:06there. You could take all your profit
88. 4:08off here, leave a runner. Meaning, let's
89. 4:10say we had four contracts. We can sell
90. 4:14three of them here, move our stop to
91. 4:17break even or even a little bit into
92. 4:19profit, and then let one contract run
93. 4:22down to the bottom. That way, you
94. 4:24capture the whole move without having to
95. 4:27risk everything. It even comes down to
96. 4:29there.
97. 4:33And it looks like we're going to get it.
98. 4:35Yep. Boom. And that would have been your
99. 4:37full takerit. Let's look at a bullish
100. 4:39example. We have put in a high, a low, a
101. 4:41higher high. We are coming back down
102. 4:43into our OT range. We've tapped into a
103. 4:47higher time frame fair value gap. We've
104. 4:50put in an SMT. So that means here on ES,
105. 4:54we've swept this liquidity. We've swept
106. 4:57internal liquidity. We've inverted a
107. 4:59fair value gap. We've had a change in
108. 5:01the state of delivery. And we have clear
109. 5:04opposing liquidity on the opposite side.
110. 5:07Here we are on the 1 hour time frame.
111. 5:09We're going to mark this range here. As
112. 5:12you can see, we've come back down into
113. 5:13OTE.
114. 5:15No, we have a little
115. 5:18fair value gap there. Let's see if
116. 5:20there's something better on the 15. Yes,
117. 5:23look at this. Okay, so we have a nice
118. 5:2515minute fair value gap here that we are
119. 5:28delivering out of. We have I'm going to
120. 5:31delete this for now. We have swept
121. 5:35liquidity here
122. 5:38and we have then had an internal sweep
123. 5:39of liquidity
124. 5:41here. Let's see on ES
125. 5:45we have swept this low here and on NQ
126. 5:55sorry on ES we've swept this low here
127. 5:57and on NQ we have not swept this low
128. 5:59here which means we have an SMT
129. 6:03on the higher time frame. That's
130. 6:04fantastic. So SMT on the higher time
131. 6:07frame you've got your sell side
132. 6:09liquidity that was taken here. You've
133. 6:11had your in internal liquidity that was
134. 6:14taken here. You're delivering out of
135. 6:16this 15inut
136. 6:19higher time frame fair value gap. So
137. 6:22let's zoom in even further to the one
138. 6:24minute and see if we have an entry. All
139. 6:28right, we're a little late on this one.
140. 6:31This is our internal liquidity sweep,
141. 6:34the bigger picture time frame. So this
142. 6:36is a good example of what happens when
143. 6:38you have stacked fair value gaps like
144. 6:40this uh in our entry criteria area. So
145. 6:43you have a fair value gap here. You have
146. 6:44a fair value gap here. So what you will
147. 6:47do is
148. 6:49connect all of the fair value gaps and
149. 6:52make it one big fair value gap because
150. 6:54you're going to need to inverse all of
151. 6:56them. So this would be our fair value
152. 6:58gap. Our change in the state of delivery
153. 7:00would be up here. I mean look at this.
154. 7:03Let's just bounce off that perfectly.
155. 7:06Let's just do this. Uh
156. 7:13so we come down. All right. We enter
157. 7:16here
158. 7:19and we would be targeting this high
159. 7:22here.
160. 7:25Uh going long. So that's our entry. This
161. 7:28is
162. 7:30pretty decent risk. Uh you can
163. 7:36if you wanted to, yeah, it's pretty good
164. 7:38risk-reward. You could also put it below
165. 7:41just right below the fair value gap
166. 7:42because this is still a pretty big drop
167. 7:44here. It's another 28 points. Um and
168. 7:47just make sure you have a tighter risk.
169. 7:49Um and let's see what happens.
170. 8:04Okay, I'd probably be break even at this
171. 8:06point. So, we'd move our break even to
172. 8:08right here.
173. 8:34profits up here.
174. 8:36Oh, wow. Boom. All right. And that hit
175. 8:38our takeprofit for a nice $1,300 run.
176. 8:43Uh,
177. 8:45that's it, guys. This is your model.
178. 8:48[music]