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The Most Valuable Top Down Analysis Guide You'll Ever Watch — Transcript

by Waqar Asim · 15,853 words · 2,236 segments · language en · Watch on YouTube

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0:00As a trader, top down analysis is
0:01probably one of the most important
0:03things to get right. Now, when it comes
0:04to building a trade idea, where do you
0:06normally begin? You begin at the highest
0:08time frames and you work your way down.
0:10The reason for that is you want to
0:11understand the bigger picture before you
0:13get microscopic. And then the last piece
0:15is the entry. However, the big mistakes
0:17I see people doing with top down
0:18analysis is focusing too much on the
0:20higher time frames. The myth being is
0:21the higher time frame has more money. It
0:23takes more time to move. Therefore, it's
0:25the one to be trusted. That is not the
0:27case. They have equal importance. The
0:29key is how you connect them together.
0:31Building a picture, building a story,
0:33and flowing through with a correct
0:35context. That is the objective of a top-
0:37down analysis. So, by the end of this
0:39video, I'm going to teach you how to do
0:40an optimal top- down analysis,
0:42especially if you want to optimize for
0:44day trading and intraession trading. And
0:46no, we're not going to focus just on
0:48supply and demand and market structure.
0:49The reason for that is when a daily time
0:51frame is bullish, a 4hour time frame is
0:53bearish, M15 is bullish, M5 is bearish,
0:55what is the trend? And this is where
0:57traders get confused. This video is
0:58going to be the most complete and
1:00valuable top-down analysis guide, taking
1:02you from beginner on the higher time
1:04frames all the way to the lower time
1:06frames. Learning how to connect it
1:07together to achieve the right objective
1:09of a top- down analysis. Not just
1:11wasting time, but understanding how
1:13you're painting a picture to understand
1:15price. Okay, chapter one is
1:17understanding what is the objective of a
1:18top- down analysis. Apart from a
1:20routine, a habit that we are all taught
1:22to do. If we don't have a direction, if
1:24we don't have an aim, if we don't know
1:25what we're trying to achieve, then we
1:27are just going with the motions and not
1:28actually aiming for something useful
1:30because not all information is relevant.
1:32We need to know what is relevant to help
1:33us make a decision for a trade today.
1:35So, what my objectives are for a top-
1:36down analysis is not that I prioritize
1:38one time frame over the other. The idea
1:40is that each time frame gives me three
1:42things that I need to figure out. And
1:44then later on once I've done my top down
1:46analysis with my key time frames I'm
1:48going to share in a moment then I have a
1:50full picture of all time frames then my
1:52job is to compress them together to a
1:53full picture to help generate a few
1:55biases. A daily bias, a weekly bias, a
1:58session bias and then a key time window
2:00bias. These are all going to be
2:01connected and starting with the
2:02foundation of a top down analysis.
2:04However, I don't need to inspect on the
2:06daily time frame every little thing
2:08that's going on on the weekly time
2:09frame. Understand everything going on.
2:11Why? A weekly trend may look something
2:13like this. And then you might have the
2:14pullback down. Where could that pullback
2:16be going? Well, it could be going to a
2:18demand area all the way down here. So
2:20then you may be left believing that
2:21okay, it's a very easy trend because I
2:24have a higher low that made a higher
2:26high. I've trended down, pulled back
2:28into a demand area to look for a new
2:30higher high. This is logical. This is
2:32just basic market structure. But do you
2:34notice the issue that this is today's
2:36price action and this might be a month
2:38ago. This might be 6 months ago. This
2:40might be a year ago. This might be 2
2:41years ago. So what's the point of trying
2:43to understand every little key detail?
2:45What is the relevance of this supply
2:47zone and how fast price moved if we are
2:50sitting here today. So therefore a lot
2:51of top down analysis can be a waste of
2:53time where you think you are doing
2:55something productive. But there's
2:56nothing useful that comes out of it.
2:58Especially if you understand my goal as
2:59an intraday trader, an intra session
3:00trader, a scalper. Usually people who
3:02are optimizing for profits are usually
3:04in and out of a trade within the space
3:06of minutes, hours, sessions, or maximum
3:09a couple of days. What's the relevance
3:10on the weekly time frame of price coming
3:12to this demand area and knowing that I'm
3:14creating a higher high? Because we might
3:15spend months coming down, weeks
3:17accumulating, and then months continuing
3:19higher. And I'm trying to figure out
3:21what's happening today. What's the daily
3:23bias for today? So therefore, the
3:24understanding is what is the relevant
3:26picture out of all of this? Surely, it's
3:28not somewhere here. It's maybe not even
3:30here. I need to understand what's
3:31relevant in the immediate vicinity and
3:33what is going to be relevant on the left
3:35and what is going to be relevant prior.
3:37So therefore it's understanding where in
3:39a top down analysis to look not just
3:41aimlessly reading price action for years
3:43trying to piece things together. What is
3:44the relevance knowing that this was a
3:46previous higher high what is the
3:47relevance knowing that we had a large
3:48fair value gap here. They are not
3:50relevant. So the objective is really
3:51important to understand. Now the reason
3:53this is so important to get right is
3:55because if you nail your entries entries
3:57are pretty easy to do. There's a limited
3:59ways to enter. Whether it's a break of
4:00structure, a two-leg protocol, a market
4:02execution, a dogey candle, there is a
4:04finite ways to enter. What about
4:06stop-loss placement? Very easy. Once
4:08again, you cover the session low, you
4:09cover the hourly low, you cover the
4:10weekly low. Again, where you're going to
4:12place your stop is limited ways to do
4:14it. And your take-profit levels, once
4:15again, very limited based on
4:17risk-to-reward, based on liquidity,
4:19based on structure targets. So, if you
4:21realize the trade management portions
4:22are very simple, limited ways to enter,
4:24limited ways to put a stop loss, limited
4:26ways to get out. So what is the
4:28important part is knowing the direction,
4:29knowing the context because good entry,
4:32good execution, bad bias will always be
4:34a loss. The main thing for a trader to
4:37understand is directional bias, context
4:39and picture for the day and the entry
4:41becomes the easy part. Therefore, the
4:43objective is going to be key. And the
4:44three things for the objective are going
4:46to be these. Objective number one is
4:48trend. But trend is a loose term because
4:51trend can simply mean market structure.
4:53I'm not focusing on just simple trend
4:55analysis. The subsection to this is
4:57understanding the main push. Now the
4:59main push is important because when you
5:00have a general trend in the markets, it
5:02can be all over the place. You can have
5:04higher high, higher high. You can have
5:06lower high that made a lower low. You
5:07can have a break of structure. All of a
5:09sudden you whips saw out of here. The
5:11trend is ever changing and it depends
5:13what lens you look at. Some could say it
5:14was bearish from here to here. Others
5:16could say now it's a bullish break.
5:17Others would say no, this is a bearish
5:19break of structure. This is the supply
5:20zone. Others would say no, this is a
5:22high. This is a higher high. This is a
5:23liquidity grab. It's continuing higher.
5:25it can get very complicated and very
5:26messy and that's only on one time frame.
5:28The moment you add in other higher time
5:30frame demand areas, other higher time
5:31frame supply areas, other liquidity
5:34pools like a trend line, all of a sudden
5:36you don't know what you're looking for.
5:37You don't know what the trend is and
5:38most importantly you just pick one. You
5:40randomly guess one and now you have
5:41shaky foundations for a setup because
5:43you may believe we are bullish when you
5:45are bearish all along and then you're
5:46looking for buy entries, buy
5:47confirmations, buy market structure and
5:49all of a sudden you're falling into an
5:51avoidable loss because you're following
5:53a trap rather than the intention of the
5:55markets. So the main push helps you
5:57filter away from this random chaotic
5:59trend which can be fake outs, it can be
6:01manipulations, it can be temporary
6:03trends, it can be all kinds of different
6:04objectives. It filters it all from
6:07messy, unclear, confusing, misleading to
6:10one thing you're looking for. That is
6:11the main push. The few things to take
6:13away from what is a main push is
6:14understanding. Ignore the rest. This is
6:17why it's useful. It helps you know what
6:19not to look at. Therefore, you don't
6:20have to look at a 100 candles. You don't
6:22have to look at 20 market structure
6:23points and 20 points of interest and 20
6:26supply zones and 20 trend lines. That
6:28can be overwhelming, confusing, and most
6:30importantly, misleading because they're
6:31all pieces of a puzzle. If you weigh
6:33them all equally, you give relevance to
6:34them all. All of a sudden your
6:36decision-m is swayed. But if you
6:37eliminate most of them, maybe the
6:39decision is something else. So knowing
6:40what to ignore means you have
6:42invalidations. It means you know what to
6:43prioritize which helps you build better
6:45foundations. The next thing about the
6:47main push is understanding new
6:48territory. The reason new territory is
6:51important is because the whole point of
6:53understanding trend is not to understand
6:55arbitrary higher highs and higher lows.
6:57It's to understand objective which is to
6:59understand intention. Who is in control?
7:01Where are they going? Why have they
7:03entered? and when are they going to get
7:04out? These are the questions we need to
7:06ask. When the market is in a point of
7:08interest, let's say, and we assume
7:10buyers are going to get in, we have to
7:11understand where would the buyers get
7:13in, how would they get in, at what time
7:14of day would they get in? Are they
7:15looking to buy to a session high or a
7:17new higher time frame daily impulse?
7:19These are relevant questions. And other
7:21relevant questions are going to be who's
7:22on the other side of it, who is their
7:24counterpart? There's a larger buyer, who
7:26is their seller? These questions can
7:28lead you down a path of confusion until
7:30you understand the main push is going to
7:32help me see new territory. New territory
7:34automatically means intent which
7:36automatically means control. And once
7:38you understand intent and control,
7:40you've therefore understood what the
7:42institutional objective is. And the
7:44reason this is the golden word
7:45institutional objective is because
7:47institutional objective tells us who is
7:49in control. It tells us what is their
7:51intention and it tells us which new
7:52territory they are targeting. And that's
7:54the whole point. We are looking for the
7:55objective of price that is going to help
7:57me better understand a daily trend, a
8:00daily bias, the next daily candle. All
8:02comes from not market structure, not
8:04supply and demand, not Fibonacci, not
8:05patterns, not all these indicators. It
8:07comes from institutional intent. Why?
8:09Because institutions move the markets.
8:11You and I do not have enough liquidity
8:13to cause market impact, to cause trends.
8:15The only person that can cause a trend,
8:18market impact, a market movement is
8:19those with large volume. Those that have
8:22large volume are naturally going to be
8:23institutions. Therefore, I like to think
8:25of it as a self-fulfilling prophecy. If
8:27a large institution is buying and they
8:29are inviting other institutions to buy
8:32and all of a sudden you have a skew
8:33where it's not a 50/50, you have buyers
8:36in the market and equally amount of
8:38sellers in the markets. The whole point
8:39is if you have equal number of buyers
8:41and sellers in the market, the market is
8:43naturally going to be neutral. But all
8:44of a sudden, if I get rid of that and I
8:46move it to here and I say, "Okay, we
8:49have way more buyers in the market
8:51compared to how many institutional
8:53sellers we have in the market." What is
8:54that going to mean? If you have more
8:56large players that are buying and less
8:58large players that are selling, what
9:00will price do? The resultant of price is
9:03it's going to go up because you have the
9:05buying pressure from these large buyers
9:08and these small sellers are not able to
9:10hold it. And then it's a domino effect.
9:12If price starts to move up because large
9:14institutions are buying, these sellers
9:16are going to be less incentivized to
9:17keep holding their position and all of a
9:19sudden you have a trend, you have
9:21momentum, you have explosive price
9:23action because it's biased one way. This
9:25is the whole point of understanding
9:26institutional objective, institutional
9:28intent because it tells you what's
9:29happening next because of this term
9:31self-fulfilling. If an institution buys,
9:34price must move. Point number two is
9:36understanding point of interest. That is
9:38the second objective we need to look
9:39for. Remember we have three things that
9:41we are looking for in a top down
9:42analysis not a million things. Now,
9:44points of interest. Already, I'm sure
9:45some terms are coming to your mind. And
9:47all of a sudden, you probably think,
9:48I've got it figured out. I know exactly
9:49what I'm looking for. But do you know
9:50how to differentiate between false POI,
9:53weak POI, relevant POI, temporary POI?
9:57Notice how there are multiple types of
9:59points of interest. And again, it's not
10:00about whatever is closest is best. We
10:02have to understand what is the
10:04objective. For example, if I see price
10:05coming into a weak POI, then I know it's
10:08likely to not hold. So, this is going to
10:10help me better understand the main push.
10:11If I know we are targeting a weak POI,
10:14however, if I know we're coming to a
10:15relevant POI, but it is false, then I
10:18know this is going to be a trap. We
10:19might get a false POI. Price comes into
10:22the false POI. We might come into this
10:23area. It's relevant because it's local.
10:25It's relevant because maybe it led to a
10:27higher high, but we know it's a trap. We
10:29might get a false reaction. Price may
10:30grab liquidity and go the other way.
10:32Notice how knowing not just the POI
10:34alone is not relevant. Is knowing what
10:36type it is and most importantly how it
10:38fits into the picture because it might
10:40be a few of them. It might be a weak POI
10:42that is relevant or it might be a
10:43temporary POI that is false. So knowing
10:45what category of points of interest is
10:47important and then knowing how to refine
10:49it is also the next step which is when
10:50we go down the top down analysis we
10:52refine the POI to assess its quality
10:55because it might be a relevant POI that
10:57is strong from the first glance on the
10:59daily time frame but by the time you
11:01work your way down to the M5 time frame
11:03you might realize oh no this is a weak
11:05POI. Even though on first glance it
11:07looked good, upon inspection and in
11:09refinement we realize it's actually a
11:11false trap POI. So knowing trend is
11:14going to help us institutional intent.
11:16Knowing points of interest is knowing
11:17which areas to focus in because my job
11:19is not to trade in no man's land. My job
11:21is to trade when the market is reversing
11:23or continuing when the volume and
11:25movement is coming in in line with the
11:27main push in line with institutional
11:29objective which is a self-fulfilling
11:31price law. Therefore, understanding the
11:33type of point of interest is going to
11:34better help me frame the day, frame the
11:36session as opposed to generally looking
11:38at random points of interest of higher
11:40highs and higher lows. And number three
11:42is going to be liquidity. Now,
11:44liquidity, once again, I'm sure a lot of
11:46terms are jumping into your mind from
11:47things you've already learned. Now, not
11:49all liquidity is the same. Not all
11:51liquidity has the same relevance. Not
11:53all liquidity is going to be relevant
11:54for today. Most importantly, how do you
11:57differentiate trap from real? How do you
11:59differentiate a smart money sweep versus
12:02a real inducement? How do you understand
12:04the difference between price is
12:06attracted to this liquidity pool that is
12:08driving and pulling price for today
12:10versus this is resting liquidity price
12:12is going to come back to it another
12:13time. So therefore you need to learn how
12:15to categorize liquidity and categorize
12:17the interaction with the liquidity
12:19because there is going to be many types
12:21of liquidity. Let's say support and
12:23resistance liquidity, POI liquidity,
12:24trend line liquidity, high of previous
12:26day liquidity, high of previous week
12:28liquidity, Asia high liquidity, session
12:30high liquidity. All of these are valid
12:32liquidity pools. But then you have
12:33different types of interactions with it
12:35such as a major inducement, medium
12:37inducement, minor inducements, and then
12:39you have a smart money sweep which often
12:41leads to a smart money trap. So then you
12:43have a web and you need to know how to
12:44connect it together. And then once again
12:46when I interact with these three the
12:49three key principles I need to
12:50understand how I holistically consider
12:52all of these because each one of these
12:54pieces of the puzzle is relevant and
12:56important. I'm going to look for all
12:57three of them. However, how I connect
12:59them together is the difference between
13:01being a SMC trader that loses because
13:03you're falling into SMC traps versus
13:05someone who is understanding the correct
13:06institutional objective, institutional
13:08intent, who is in control to understand
13:10the self-fulfilling price law at the
13:12right point of interest with the right
13:14liquidity in mind. When you connect it
13:16together, you have a good idea. Now,
13:19just to give you an indication, when you
13:20come to a point of interest, yes, you
13:21can have a large POI, but price doesn't
13:23always come to points of interest. Where
13:24else can price reverse from? It can come
13:26from engineered liquidity or existing
13:28liquidity. So in the next step, we're
13:30going to show you how to break things
13:31together, connect them together to
13:33generate real life intention and
13:36objective as opposed to arbitrary zones
13:38where you just marked out a point of
13:39interest. Price is taking weeks to
13:40arrive there. It finally arrives there.
13:42You finally have your entry after
13:43waiting and waiting and price blows
13:45through it. That could have been
13:46predicted and understood if you
13:47understood institutional objective and
13:49you're not aimlessly waiting for these
13:50points of interest thinking there's
13:52something more valid than they are. So
13:53when it comes to liquidity I'm going to
13:54be looking at a few forms is the types.
13:57So it's to understand which one is
13:58important. What are the types all
14:00together number two is importance. Now
14:02importance can mean a few things. Number
14:03one is what is the type of liquidity? A
14:06big support level is going to be more
14:08important than a little buildup in the
14:09middle of Asia. Then we're also going to
14:11have to understand not just types and
14:12importance. It's also interaction. When
14:14we see an important type of liquidity
14:16getting interacted with correctly and we
14:18see we have the right type of liquidity,
14:20the right importance and the right
14:22interaction, then we know if we are in
14:24the right zone and we are with the main
14:26push, all of a sudden you have a trade
14:27idea. Notice if you're missing any one
14:29of these pieces of the puzzle, you will
14:30fall into a trap or confusion. And even
14:32if you have a great entry, even if you
14:34have a great time window, you might have
14:35a good entry, stop-loss, and take-profit
14:37level. But if the ideation is incorrect,
14:39your trade will always be incorrect. So
14:41coming into chapter 2, we already know
14:42what the objectives are for our top down
14:44analysis. So let's break it down a step
14:46further by understanding what are the
14:47subcategories of those three things.
14:49Trend, liquidity, point of interest.
14:51Let's break them down so you can see
14:52what am I exactly looking for in these
14:54three categories. And second of all, how
14:56I connect the time frames, what are my
14:57relevant time frames? Which order do I
14:59do it in? And what important factors do
15:00I take from each one of them? Is it a
15:02carbon copy or is the daily telling me
15:04one picture and the 5 minutes telling me
15:06another picture? Let's now connect
15:08everything together. So we spoke about
15:09the three objectives which was trend,
15:11point of interest and liquidity. Now
15:13let's break it down into we spoke about
15:15the main push. Now the main push what am
15:17I looking for? Remember what I said it
15:19was new territory. So when you have
15:20price action in terms of a trend doing
15:22all kinds of things. Price is not always
15:24simple higher highs and higher lows. I'm
15:26going to draw just a random line. And
15:28how would you know what is the trend
15:29here? How would you understand what is
15:31the trend? Because some would say oh
15:32it's a series of higher highs and higher
15:34lows and therefore I'm grabbing
15:35liquidity and I should be going to make
15:37a new higher high. Another would say,
15:38"Oh, it's a bearish market. It was had
15:39lower high that made a lower low. Lower
15:41high that made a lower low. Therefore,
15:42it's bearish and therefore this
15:44liquidity is irrelevant. I'm going to be
15:46selling from this supply zone." Others
15:47would start to say, "Okay, this is a
15:48liquidity pool. This is a sweep." Others
15:50would say, "This is a liquidity pool.
15:51This is a sweep." Others would say,
15:52"This is trend line liquidity.
15:54Therefore, I need to target it." Notice
15:55how it can already get very complicated
15:57very quickly. So, what I need to
15:58understand when I'm looking for my main
16:00push is not always simple market
16:02structure. New territory simply means
16:04where has price never been before. new
16:07territory, recent new territory. Of
16:09course, price can already have been here
16:10in the past, but I'm saying recently,
16:13what was my range high and my range low?
16:15And has that been broken? So, what I do
16:17is break up the market into impulses.
16:19Impulses are just following previous
16:21market movements. For example, this high
16:23that made this low broke past a previous
16:26low. So, now I have a bearish impulse
16:27that I'm paying attention to. Now, I
16:29have another bearish impulse. Would this
16:30be relevant? No, because we are still
16:33inside of the range of the previous one.
16:35Therefore, if this is internal to it,
16:37it's not new territory. It's not a new
16:38main push. Same for this one. If we
16:40switch bullish and we broke past this
16:42previous high, you could say, "Oh, we
16:43had a bullish break of structure. It's a
16:44bullish main push." No. Because even
16:46though it is high, high higher low,
16:47higher high, we are still inside of the
16:50previous main push range. This is how
16:52you start to identify on each time frame
16:55external and internal structure.
16:57Internal trends are short-term. Internal
16:59trends can be misleading. External trend
17:01is what counts because that is the
17:02market impact. That is the one that is
17:04driving price. So, in this video, I'm
17:05showing you how to do a top- down
17:06analysis. And the point of this is to
17:08help build foundations and understanding
17:09what's going to happen today. However,
17:11context matters. Building a picture
17:13matters because without these, you are
17:15blindly following a checklist as opposed
17:17to being in tune with the market and
17:19reading price like you're reading a
17:21book. So, what I want to do very soon is
17:23a free Zoom call for anyone to attend.
17:25If you've been watching this channel,
17:26you've had a few aha moments, but maybe
17:28you have a few more questions. Then
17:30together we can have a deep dive on this
17:32upcoming master class all around market
17:34intention, market traps, and market
17:36impacts to help you better understand
17:38who's in control, what direction they're
17:40going, and how to build optimal trade
17:42models around it. If you are interested
17:44to attend this live master class, then
17:46click the link in the description
17:47because seats are going to be limited.
17:49All you need to do is reserve your place
17:50and join the group so I can send you the
17:52link. I can send you the workbook. I can
17:54send you some resources before the live
17:55event so you are ready, plus an
17:57opportunity for you to submit your
17:58charts and your questions. I don't do
18:00these very often, but whenever I have
18:02done it in the past, it always reaches
18:03Zoom's capacity within minutes of going
18:05live. So, as the big day approaches, I
18:07encourage you to quickly pause the
18:08video, go in the link in the
18:10description, and reserve your place.
18:11Okay, with that being said, let's get
18:12back into the video. So, when I do a top
18:14down analysis, let's say this is the
18:15daily time frame. I'm going to start a
18:17little bit to the left, not exactly
18:18where we are right now, a little bit to
18:20the left, and I'm going to mark out my
18:21external and internal structure. So,
18:22let's do it together. We had this
18:24external bearish push. Where is it
18:26broken? At which point did it break? Did
18:27it break higher first or did it break
18:29lower first? It broke lower first. So,
18:31therefore, I have a new range. This was
18:33the high. This is the low. And we broke
18:35down this way. So, now we have a new
18:37range high and a new range low.
18:39Therefore, I can delete the previous
18:40ones. That one has already hit played
18:42out. And I now have a bearish main push
18:44because we had a bearish break of
18:45structure. It wasn't because we broke
18:47this one. That's the internal. I need to
18:49break external. So, now we had that
18:51break. What is the new range? this low,
18:53this high. Which way did it break first?
18:55We broke lower. Okay, now we had a
18:57bearish main push lower. But notice how
19:00these areas flip. So now we went from a
19:02bearish market to a bullish market
19:05because we had a bullish push up. Some
19:07might be waiting for this high and say,
19:09"Oh, that's my bullish break of
19:10structure." No, I'm breaking it down
19:12into market impulses that are relevant
19:14from new territory. Now I have a new
19:16range low and a new range high. Which
19:18way is it broken? Broken up here. So now
19:20I have a new range high from this higher
19:22low to this higher high. I'm breaking it
19:25into ranges. Which way is it broken? Up
19:27here. So therefore, it's a new
19:28territory, new high. Which way is this
19:30one broken now? We broke down bearish.
19:32So notice how it's very similar to
19:33market structure, but it's slightly
19:35different because at times they will
19:37heavily overlap. Market structure will
19:38be the same as main pushes, but at times
19:41when you complicate internal and
19:42external structure, structure may tell
19:44you one thing. market movements, market
19:46impulses, main pushes may tell you
19:48another because you're breaking down
19:50external to internal like this. So now
19:52we have a external high and an external
19:55low. So even though I have this internal
19:57trend where we have high, higher low,
19:59higher high, this internal trend is not
20:01relevant at all because it didn't
20:03interact with the range high or the
20:04range low. So I'm not going to
20:06hopelessly jump into every demand area,
20:08every higher low that made a higher high
20:10because the context matters. You begin
20:11with the main push to direct your trend,
20:13not just higher highs and higher lows or
20:15lower highs and lower lows. It's the
20:17last main push that was interacted with.
20:20So, let's follow it through. We see the
20:21last one is bearish over here. We have
20:23this range high, this range low. We even
20:26though it's bearish, we broke higher.
20:28So, now we have a new range high and we
20:29broke through, made a new range low.
20:31This is the range low and the last one
20:33is new range high, new range low. We
20:35have this last main push. Now, this may
20:37seem overkill, and it is because I'm
20:39trying to make the point very clear. But
20:40what you're really looking for in a top-
20:42down analysis is per time frame to spend
20:44no more than 2 minutes. In fact, myself,
20:46I spend 30 seconds because I'm just
20:48looking for three key things. Main push.
20:50How long does it take to find a main
20:51push? Literally 10 seconds. What is the
20:53last lower high that made a lower low or
20:55the last higher low that made a higher
20:57high? New territory. Price has not broke
20:58this floor yet. Now, we have broken it.
21:00This is my new floor. This is my new
21:02ceiling because we didn't interact with
21:04this one. And in fact, this became the
21:05new ceiling because it interacted. It
21:07allowed price to go lower. Now, this is
21:09the reason it's useful because now
21:11everything on the left, weeks prior,
21:13months prior, years prior, I can ignore.
21:15It is not relevant for me. I'm only
21:17focused on in the box of my range high
21:19and my range low. And inside of there,
21:22all kinds of things are going to happen.
21:23You're going to have bullish internal
21:25trends, bearish temporary trends. You're
21:26going to have internal continuations.
21:28You're going to have liquidity sweeps.
21:29And you think, "Oh, we're bearish all of
21:30a sudden." You're going to take a low.
21:31You think that's it. All of a sudden you
21:33come to the extreme and then finally you
21:35break it. That's when you know trend has
21:37continued for that time frame. So if you
21:39are inside the box of one time frame
21:41then you stay with there and you don't
21:42need to look for more main pushes. You
21:44just know I'm this is my high this is my
21:46low and I'm likely headed this way.
21:48Anywhere inside of it might spend hours,
21:51days, weeks or months inside of the main
21:53push. And as long as it's inside the
21:55range it is relevant and I don't need to
21:57do anything else. So it's just a glance.
21:58So when I do my top down analysis I
22:00don't do it every day. I do it once at
22:02the beginning of the week and I mark it
22:03out and until it's broken one of my
22:05criteria, I leave it there. I don't need
22:07to check every day, every morning, every
22:09trade at the higher time frames. I check
22:11once, mark my levels, and then the job
22:13is done. It takes 30 seconds. So, now
22:15that we've done the main push and we
22:16know it should only take us 30 seconds.
22:18What time frames are we doing this on?
22:20So, the time frames that we're going to
22:21do on, I like to think of it as package
22:23time frames. There's no point doing
22:24monthly, weekly, daily, 4 hour, 1 hour,
22:26M30, M50, and M5M. What are we doing
22:28here? We're just looking at all random
22:30time frames. Also, what is the
22:31difference between a 3-day, a 2-day, and
22:33a 1 day? What is the difference between
22:34a 4 hour and a 6 hour and a 12 hour? Why
22:37is the 1 hour relevant when some people
22:38look at the 45 minutes? Why 30 minutes
22:40over M15? What is the importance of each
22:42time frame? What is the purpose? What am
22:44I looking for? So, main pushes on
22:46relevant time frames that I package. So,
22:47these are my packages. You might have
22:49the monthly slashweekly/aily.
22:53This is one package. They are all
22:55telling me basically the same thing. the
22:57bigger picture, main push, and then
22:59points of interest and liquidity. I
23:01don't need to find a separate weekly,
23:03monthly, and daily one because they are
23:04likely all going to be similar,
23:06overlapping, or the one that you find on
23:08the daily is maybe more relevant than
23:10the one you find on the monthly. And
23:11most importantly, the monthly one might
23:13be 500 pips, the daily one might be 70
23:16pips. So, the daily is my preferred one
23:18because it's relevant, it's more
23:20refined, and it's more recent. So,
23:22therefore, on this package time frame
23:23number one, I pick daily. The next one
23:25is going to be my middle time frames. So
23:27this is where I usually look at the 4our
23:29time frame slash the one hour time
23:31frame. Now again these are going to tell
23:33me a very similar picture. The points of
23:35interest on the 4 hour and 1 hour is
23:37going to be the same one. They just are
23:38wider or smaller. The trend is going to
23:40be very similar on the 4 hour and 1 hour
23:42because they are basically the same
23:43impulses. They are the same market
23:45movements. So therefore I personally
23:47prefer the 1 hour but they are actually
23:48totally equal because they'll tell you
23:50the same thing. I would say for
23:51beginners start at the 4 hour have
23:53bigger zones but once you start to
23:55understand intention better trend better
23:57false points of interest better
23:58liquidity better then you'll actually
24:00prefer the 1 hour because instead of a
24:0160 pip zone you can have a 30 or 20 pip
24:04zone refinement matters and knowing how
24:06to refine it even matters more so that's
24:07my next package 4hour 1 hour I
24:09personally pick the 1 hour time frame
24:11remember on each one of these packages
24:13I'm doing the three steps the main push
24:15which takes 30 seconds the point of
24:16interest inspection again that's going
24:18to take a minute or two and liquidity
24:19that should not take you more than a
24:21minute. So a top down analysis is about
24:231 and a half minutes per package time
24:25frame. So we spend 1.5 minutes on the
24:27daily time frame. We spend 1.5 minutes
24:29on the 1 hour time frame and then we
24:30move down a package. Top down analysis
24:32is not supposed to be a whole Sunday
24:33afternoon and then every day before the
24:35session starts you spend another hour.
24:37It's supposed to be a one-time job
24:39marking the relevant levels and then is
24:41job done until they are voided. So I
24:43don't do a top down analysis or a full
24:45flow all the time. I do it once at the
24:47beginning of the week and then I spend
24:49the rest of the week on M1 until I
24:51breach one of the trends, one of the
24:53points of interest or one of the
24:54liquidity pools. Until then, I'm staying
24:56on M1. M1 is home for me. That might
24:58sound crazy because you're very used to
25:00jumping up and down time frames. That's
25:01why you take losses because you're
25:03confused because you're looking for
25:04things that are not relevant and all of
25:06a sudden when you don't know what you're
25:07doing because the weekly is telling me
25:08one thing, M15 is telling me another
25:09thing, M1 is telling me another thing.
25:11You don't know which one to prioritize.
25:12You don't know which trend to pick. So
25:13you just go for the biggest one or you
25:15just go for the higher time frame one
25:16not knowing that was not the flow to
25:18follow. The next package is going to be
25:19my intraday time frame. Now the intraday
25:22time frame is going to be between M30
25:24and M15. The 15 minutes and the 30-inut
25:27time frame. These are going to tell me
25:28the basically the same thing. They
25:30basically tell me intraday movements,
25:31intraday objectives, intraday points of
25:33interest, intraday liquidity. I
25:35personally prefer M15. In fact, my
25:37preferred time frames, I spend a bit of
25:39time on daily, a bit of time on one
25:40hour, but I spend most time on M15 and
25:43more time on M1. These are my main time
25:46frames. Why? Because the day's movement
25:48is more influenced by what happened
25:49yesterday or this week as opposed to
25:51what happened 6 months ago on a daily
25:53time frame point of interest. Recency
25:55matters in the markets because
25:56participation is what moves markets and
25:58recent price action influences recent
26:00participation more than a point of
26:02interest on the monthly time frame from
26:046 months ago. That is an existing level.
26:06It may become relevant. It may be
26:08irrelevant. What is more relevant is
26:10what is happening this week. This week's
26:12trend, this week's objective, this
26:14week's point of interest, this week's
26:15liquidity is going to have a far more
26:17impactful outcome on today's trade as
26:19opposed to higher time frame blocks,
26:21which is why I spend a bit of time, but
26:23this is my main home. And then lastly is
26:25going to be my execution or monitoring
26:27time frames. This is going to be my M5
26:29and M1. These are going to be equally
26:31valid for me because they do tell me
26:33differing things because sometimes you
26:35have a large M1 candle that might be 7
26:36to 10 pips. That is equal to a M5 candle
26:40which is usually 7 to 10 pips. So they
26:42are fluid. I need to find relevancy
26:44between these time frames. So I will
26:46actually go from M1, M2, M3, M4, M5. But
26:49most of the time it's M5 and M1. Why are
26:51they fluid? What am I trying to achieve
26:53from each one of these? Again, I don't
26:54focus on the time frame alone. Time
26:56frame doesn't mean much. It's a
26:58convenient way for me to package time
27:00frame because what does a time frame
27:02include? It includes candlesticks. So a
27:04candlestick has four main features. It
27:06has an open, it has a close, it has a
27:08peak, and it has a peak. So you have
27:10four main areas. And how does it look?
27:12Price may open over here. And then it
27:14moves up and it moves up all the way up
27:16here. Then it wicks through that level.
27:18We come down, we chop around here, touch
27:20this temporarily, we hang around here a
27:22lot, and right before we get a close
27:24over here. So this is a line chart, but
27:26it's actually come to a candlestick
27:28because it's telling me this is the
27:29body. This is where the close and open
27:32was. And price did wick up here and
27:34price did wick down here. Actually, I
27:35spent a bit of time over here. So wicks
27:37don't only mean temporary. And
27:39therefore, just because it's a slim wick
27:41does not mean it's less relevant. So
27:43this is important because a candlestick
27:44may look like this. And you may be led
27:46to believe the body is more important.
27:48But the body just simply represented
27:50where did we close. And if it's a 1
27:52minute time frame, it means it closed
27:53the next minute. If it's a three-minut
27:54time frame, it's on three-minute
27:55increments. 5 minutes, it's on the
27:565minut. So, why is it relevant if price
27:59closed at 904
28:01versus 905? On the 1 minute time frame
28:05is going to show one picture. On the
28:065minut time frame, it's going to show
28:07another picture. Each one of these
28:08different blocks, these time frame
28:10packages, they're not more important
28:12because it was 9:05. Nothing magical
28:13happened at 9:05 compared to 9:04. But
28:16in between might be the relevant thing.
28:18So therefore, I need to be fluid because
28:19I'm looking for something specific. I'm
28:21looking for momentum, volume, and
28:24manipulation. And different candlestick
28:26time frames will paint the picture
28:27differently. When we get into that,
28:28you'll understand better what I mean.
28:30So, now that we've completed trend
28:31analysis through understanding main
28:33pushes, which is new territory on these
28:34time frames, these are my preferred time
28:36frames. Now, you're starting to
28:37understand not from market structure,
28:39from main pushes. What does that look
28:40like? This is how GBPUSD looks like
28:43right now on the daily time frame, but
28:45you have a higher high. I made a new
28:47higher high. Main push bullish.
28:48Therefore, I know my long-term objective
28:50is up here. We haven't met it yet. But
28:52when I do a trend analysis, you'll
28:54think, "Oh, very simple. We've taken
28:55liquidity. We are now having higher
28:57high, higher low, higher high, and I
28:58just just need to buy up to here."
29:00That's a very simplistic approach. If
29:02you only look at trend analysis, look at
29:03the details. So, follow it from the lens
29:05of main push. So, main push first of all
29:08was clearly bullish and I eventually
29:10expect a bullish replication just from
29:12trend analysis. But this is the daily
29:14time frame that can take weeks or months
29:16to happen. And again, this trend is
29:17hundreds of pips wide. It's 500 pips
29:19plus. So why is that going to impact my
29:21today's London session or New York
29:23session? It's not necessarily the most
29:25relevant thing. So then I start to
29:26understand flow which is after that main
29:28push I had internal break. This failed
29:30to make a higher high and it didn't make
29:32a higher high. It made a lower high.
29:34Most supposedly broke territory made a
29:36lower low. So now I have a main push
29:37bearish. Two main pushes bearish after a
29:40main structure push is known as the
29:42structure cycle. Main push internal
29:44breakup structure. Second leg follow
29:45through it means initiation of the
29:47complex pullback to where to the
29:49efficiency of the pullback which is a
29:50demand area down here. Notice how price
29:52comes into that demand area eventually
29:54lower highs and lower lows. And what
29:55happens after that? You come into the
29:57demand area. Perfect. You have a break
29:58structure bullish. Very cool. Then you
30:00have a higher low. Very cool. Breaks
30:02territory makes a new high. Very simple,
30:04right? And you now just think, oh, we're
30:05just going to go and make the new high.
30:07But notice how price has other ideas.
30:09This is literally GBPUSD right now. We
30:11made a low. So you think, okay, we're
30:13having a pullback. We broke structure.
30:15Where are we going? Are we continuing
30:16this bearish trend to make a new lower
30:18low? Are we just coming to this area
30:19over here? Price did a lower high,
30:21failed to make a high, made another
30:23internal lower low. So, now we see
30:25something interesting. People are going
30:26to be selling over here. People are
30:28going to be thinking it's a new bearish
30:29market and we're looking for
30:30continuation lower. Others are going to
30:32be thinking, oh, we know we're bullish.
30:33This is just a liquidity grab that
30:34failed. Okay, you can get lost in the
30:36source on just one time frame. Imagine
30:38mixing the time frames. So instead of
30:40doing that, you go with market impulses,
30:42main pushes. By the way, main pushes
30:44change all the time. That's fine. It
30:46doesn't mean it was wrong. It just tells
30:47me where I should focus on and build
30:50road maps from because it's not just a
30:51simple case of we have lower high and
30:53lower low. There's a supply zone. So the
30:55only option that exists is to make a
30:56lower low. That is very simplistic and
30:58usually it never happens that way. You
31:00have multiple scenarios on every point
31:02of the market. Price could go smoke this
31:04level. Price could induce this level, go
31:06lower. Price could tap into the open, go
31:08lower, tap into the midline, give a
31:10reaction, come higher, induce the zone,
31:12go lower. It could just drop. Notice how
31:14there's so many road maps. You could
31:15break higher, induce complex pull back
31:17to the midline, then continue higher.
31:19There's a lot of road maps, concentrated
31:21ideas in these supply zones. Therefore,
31:23that's why supply zones and demand areas
31:24matter because you have inflection
31:26points where you have valid road maps
31:28presenting a scatter of various
31:30scenarios where they all begin at the
31:32supply zone but end up in different ways
31:34in different methods. These areas are
31:36areas to focus on because you have max
31:38probability of different opportunities
31:40with momentum. You're not in no man's
31:42land. You have origination points. But
31:44you need to know which road map is
31:45presenting. Are we smoking through the
31:47level? Are we reacting through the
31:48level? Are we inducing the level? These
31:50are key questions. And therefore, it's
31:51not just market structure alone. It's
31:53intent and control in the point of
31:55interest that matters. So following it
31:56through, when we saw this sweep, we came
31:58deeper into the demand area. We swept
32:00the previous low and then we had an
32:02immediate high in the market. That
32:04implies buyers have taken control.
32:05Buyers are now moving the market. They
32:07are the ones with market impact and
32:09control. And where is the target? Well,
32:10if this was the previous high, then the
32:12not natural target is to make this a new
32:14higher high. So we have a higher low
32:15over here. Does not breach the lows. So
32:18this range was valid. We break through a
32:20high of the range. Break through the
32:21last main push to make a new high of the
32:23main push. New low of the main push. And
32:25we had a break of structure over here.
32:26Now we are seeing simple market
32:28structure once again. Right? We have a
32:30bullish impulse, bullish continuation.
32:32This is the target. We're going there
32:33for sure. Not quite the case because you
32:35have variance at these concentrated
32:37areas because naturally you have a
32:40liquidity pool trend line structure
32:42point. So when price shoots for this
32:44level, you introduce sellers. You take
32:46stop losses or sellers. You have now a
32:48reaction that price could go lower.
32:50That's fine. This is just high higher
32:52low. Maybe we go higher high. But not
32:54necessarily the only case. We might end
32:56up higher high. We might end up breaking
32:59inducing going high. We might end up
33:01tapping and going. We might come into
33:03the zone, consolidate, induce, go
33:04higher. We might come lower to the
33:06previous demand area before going
33:08higher. Variance in opportunities,
33:10varying road maps. But my job is not to
33:13understand the long-term objective or
33:15which road map is true. I just need to
33:17know in this zone which road map is in
33:19control. If I understand the main push,
33:21I know which areas to look at, which
33:22points of interest, which liquidity
33:23pools, that's going to help me generate
33:25a daily bias. Not just arbitrary. It's a
33:27bullish trend. So, I look for buys. It's
33:29a bearish trend and look for sells.
33:30that's oversimplified and leads to
33:32losses. By the way, if you're enjoying
33:33this video and you're enjoying the
33:34frameworks that I'm giving because this
33:36is just how to build your day, how to do
33:38a top down analysis. But if you want to
33:39take it from building foundations all
33:41the way to trade models, risk
33:43management, strategies, entry types,
33:45then I've prepared for you all a free
33:473-day course. Usually, people charge
33:49hundreds, if [clears throat] not
33:50thousands, for these kind of things. I'm
33:51giving it away for free because I want
33:52to make sure that people watch this
33:54channel that get a few pieces of the
33:55puzzle can have an opportunity to get
33:57the full picture where once a day for
33:59three days in a row I send it directly
34:01to your inbox. The video course for each
34:03day where we build the framework, we
34:05build the direction which we're doing
34:07today. But I'm going to show you chart
34:08examples. I'm going to show you my own
34:09trades. I'm going to show you entries,
34:11how to manage them, how to do your risk
34:12management, and how to convert it
34:14optimally for profirms. If you are
34:15interested in grabbing this full program
34:17for free, it's in the link in the
34:19description. I just need your email and
34:20you can have it for free for the rest of
34:22your life once it lands in your inbox.
34:24Get back into the video. Okay, so once
34:26you've done this on each time frame, you
34:27look at the main push. We found it. Now,
34:29very simply, we found the main push of
34:31this time frame is this higher low that
34:33made this higher high. Was new territory
34:35found? Yes, because this was the
34:36previous range high. We broke through
34:38it. We have a new range high. This is
34:40external high. So, how I mark it
34:42matters. I write my daily time frame
34:44external high and I write my daily time
34:46frame external low. Once I marked out my
34:49daily range external low, daily range
34:51external high, I do it for all my time
34:52frames. I'll start to see the bearish
34:54complex pullback and I'll start say,
34:56okay, this is my 4hour internal. Reason
34:59it's internal is because it's internal
35:01to my daily range. So this is my 4hour
35:04internal high, 4hour internal low. So
35:07notice how we have internal trends and
35:09external trends. External daily time
35:11frame is bullish. Internal 4hour is
35:13bearish. So what do I do on today's
35:15London session? Do I go bullish and buy
35:16because daily time frame is bullish or
35:18do I look for sells because the 4hour
35:19the more recent time frame is bearish.
35:21It's not one or the other. It's a
35:23connected picture. Especially when you
35:24add in the complexity of M15 which might
35:27be bullish and bearish with a mix of
35:28sweeps, consolidations, expansions. I
35:31need to understand who's in control. I
35:33just look at not the higher highs and
35:34higher lows. I don't look at the
35:35liquidity sweeps. I don't look at points
35:37of interest. I look at the market
35:38impulse. The main push was this higher
35:40low that made this higher high. I now
35:42have my M15 internal high, M15 internal
35:47low. This is all going to differ because
35:48my M15 could be down here. So, if it was
35:51down here, then I'd say this is my M15
35:52external high and M15 external low. We
35:55recently broke an external level. It's
35:57not always just external, internal,
35:59internal. It could be a mix depending on
36:01where you are sitting. So now I can
36:02write this down very plain and simply
36:04which is my daily is bullish and I have
36:07my external high, external low. My 4hour
36:10is bearish and I have my external high,
36:12external low and my M15 is bullish and I
36:15have my internal high, internal low. I
36:17have the ranges of each one. Now, what
36:19is the point of all of these ranges? Is
36:20because it tells me when each time frame
36:22ticks over to a new objective because I
36:24expect a continuation of these time
36:26frames. The daily eventually will be
36:28bullish. Doesn't mean right now means
36:30eventually this high will be broken. The
36:324hour this low will eventually be broken
36:35and this M15 high will eventually be
36:37broken. Now you can paint a picture
36:39together which means if we are bullish,
36:40bearish and bullish, how does that
36:42connect together? Road maps. Where do
36:44the road maps interact? When do you go
36:46high, higher, lower, higher, low, lower,
36:47high, lower? All of these terms, they're
36:49connected with points of interest and
36:50liquidity. So you start off with the
36:52main pushes and you log it. And then you
36:53see interactions with liquidity and
36:55points of interest to build your road
36:57maps. Once you have real road maps, you
36:58know the direction. And once you have
37:00the direction, then very easily you know
37:02the entry. It's a step-by-step
37:03framework, not guessing, trend analysis
37:06from multiple time frames, hoping you
37:07pick the right one. Okay, next, let's
37:09focus on points of interest. Now, what
37:11do you know about points of interest?
37:12Well, you're going to naturally connect
37:14it to market structure and supply and
37:15demand. Meaning, you have a bullish
37:17trend. You look for the demand area and
37:19you expect price to come to that demand
37:21area and make a new higher high. In
37:22principle, it's very basic, but it also
37:24is clean. However, notice the issue that
37:27if price is here on Monday and then
37:29Tuesday and then Wednesday and Thursday
37:30and Friday, like you can see all of
37:32these days, price is not in the POI. So,
37:34it's our goal as a trader to wait for a
37:36new high and wait for price to come back
37:38to the point of interest because that
37:39means most of the time you're doing
37:41nothing and occasionally you have an
37:43idea. But then, as we just spoke about
37:44with multiple time frame, multiple
37:45trends, multiple pushes, these areas can
37:48be relevant, they can be strong, they
37:50can be weak, they can be traps, they can
37:51be temporary important. They can be a
37:53bounce before breaking through or they
37:55can just wipe through it. How do we know
37:56which one it is? Especially if you're
37:58waiting weeks for this area to come into
38:00and then we finally arrive here, you're
38:01like, let's load up on buys and then you
38:03get smoked. This is why it's important
38:04to understand points of interest. Which
38:06ones are relevant? Which ones are
38:08qualified? How do you qualify them? How
38:10do you refine them? And then how do you
38:12trade them? This is the step-by-step
38:13framework of points of interest
38:14analysis. Okay. So, as we just said,
38:16higher high, higher low, higher high. We
38:19know in every basic trend which prices
38:21are always this simple. You will
38:22naturally have internal trends, which
38:24means inside of the main push, you will
38:25have a natural sequence of higher highs
38:27and higher lows. Maybe it goes lower
38:29temporarily, then continues higher. You
38:30understand the picture? So you're going
38:32to have internal mini trends, higher
38:34lows and higher highs. How do you know
38:36which one is relevant? So this is where
38:37I focus on premium and discount. Now
38:40that is a buzz word. So let me tell you
38:41how you do premium and discount
38:43correctly. Because if I'm following this
38:44market structure, how do I understand
38:46which points of interest were relevant?
38:48Because if I just say this each pivot
38:50point, higher low, higher high, higher
38:52low, lower high, lower low, lower high.
38:54You see all of these ones, do I consider
38:55this a point of interest because it only
38:57retraced a little bit? Do I consider all
38:59of this one pullback or do I consider
39:00each segment of it a pullback? Do I
39:02consider this pullback before the break
39:04or something? Is the separate higher low
39:05that made a higher high? Or is this all
39:07one main push? Notice how it can get
39:09confusing because you don't know what
39:10you're aiming for. Everything looks like
39:12a main push. Everything looks like a
39:13trend. Everything therefore looks like a
39:15supply and demand. Everything therefore
39:16looks like a point of interest. You
39:17trade them all and you look for simple
39:19entries in all of them. And you take one
39:20good trade and five following losses.
39:22And you don't know why those losses were
39:24there because you followed the same
39:25protocol. on each one of them. One of
39:26them was a win, five of them were
39:28losses. You're not making profits. Your
39:29win rate is in the floor, but you're
39:31following the same plan. You are
39:32following the strategy. You are learning
39:34concepts. Notice how if you don't follow
39:35right concepts, you can keep rolling the
39:37dice and correctly behaving and getting
39:39a negative outcome because you're not
39:40understanding objectively what is going
39:42on. So therefore, the rule to understand
39:44internal trends correctly because we
39:46have an external trend and green
39:48internal trend. How do we know which one
39:50is relevant? Well, I break it down into
39:5250% cross meaning. If I have a impulse,
39:56deep retracement, impulse, little bit of
39:58retracement, continuation, impulse, deep
40:00retracement, and then continuation, do I
40:02now say this is a demand area or do I
40:05say this is the only demand area and
40:06this was all one main push? No, you
40:08break it down with the 50% rule, which
40:10means I look at each pivot, whether it's
40:12big or whether it's small, I look at it
40:14and I say, okay, this low it made this
40:16high and then I just draw a Fibonacci
40:18and I'm not doing the whole Fibonacci
40:20scatter. I'm just looking for the 50%.
40:21And I say, did this pullback cross my
40:2450%. No, it did not. It tapped in a
40:26little bit before it went higher.
40:28Therefore, I do not consider this a main
40:30push. I do not consider this a point of
40:32interest. I do not consider this
40:33impactful. I connect it together as one
40:36because it did not cross my 50%. So,
40:38when you flow through what may be
40:39complicated price and you may see all
40:41types of bullish retracements and
40:42continuations. Now, I just do the 50%
40:45test and I realize from here to here,
40:47this is not a 50% cross. So that means
40:49my higher low, main push high is up
40:51here. Did this cross to 50%. Yes. So now
40:54this is my new low. This is my new high.
40:56So what went from choppy and confusing?
40:58I just have a clear picture which is
40:59this higher low made this higher high.
41:02This higher low cross the 50% made my
41:03higher high. So all of my trend points
41:06need to cross at least the 50%. If it's
41:08deeper then even better. I have more
41:09confirmation. But that's my minimum
41:11cutoff. This stops you getting caught up
41:13in every little impulse thinking each
41:14one of these is a point of interest.
41:16each one of these cuz then if you see
41:17this you're going to be like demand area
41:18demand area demand area and all of a
41:20sudden you have 20 demand areas you buy
41:21in all of them and you take seven losses
41:23the whole point is look for the relevant
41:24one. So once you have that minimum
41:25criteria of did it cross the 50% already
41:28you eradicate a lot of unnecessary
41:30zones. So with that guide of 50% now I
41:32could take a simple market trend which
41:34is higher low and higher high and then I
41:36can monitor the internal trends and I
41:38can see yes it's going to be a bit more
41:39complicated something like this. So with
41:41my 50% guide I can see this is my high
41:43this is a new higher low. This is a new
41:45higher high. This is a new higher low.
41:47Higher high crossed to 50% higher low.
41:49Made a new high. Crossed the 50%.
41:51Perfect. Up here. 50% is all the way
41:53down here. It did not cross. So it's up
41:55here. And then new high. New. And then
41:57this area fails to make a high. Goes on
41:58to make a low. Okay. So where are my
42:00areas of interest? So I could start to
42:02say each one of these pivot points. I
42:03can say that's a demand area. That's a
42:04demand area. That's a demand area.
42:06That's a demand area. And that's a
42:08demand area. And maybe even this one as
42:10a demand area. All of a sudden, okay, we
42:12don't have 20, but we still have
42:13several. So these are the two that you
42:15need to focus on. The rest become traps.
42:17Sometimes there going to be two traps,
42:18sometimes four traps. Depends how price
42:20action delivered. But the main thing is
42:22you need to look for two areas. My
42:23extreme is always the origination zone.
42:25Where did the higher low begin that
42:27initiated the move? That's always my
42:29extreme. I look for a refined IFC block.
42:31Usually as a placeholder, I do 1 hour
42:33time frame. That's usually going to be
42:3530 to 60 pips. And I'm going to refine
42:38it on M15. This is where I keep it. This
42:40is usually going to be 10 to 30 pips.
42:43And then I refine it on M5 looking for
42:46the imbalance and inducement. This is
42:48usually going to give me a pocket of
42:50something that is 7 to 15. This is my
42:52key. So I refine it from a 60 pip zone
42:55all the way down to a 15 to 7 pip zone.
42:57And I'm looking for the story inside the
42:59zone. So I start off with a placeholder
43:01on the 1 hour time frame. It can be a
43:02large one. Eventually I'm going to read
43:04what happened in here. And when I read
43:06what happened in here, I can see several
43:08scenarios. A point of interest can be
43:10price goes lower, price goes higher.
43:11Price can now come into the zone,
43:13consolidate, induce and go. Price can
43:15come into a level, build a trend line
43:18out, and then pop. All of these three
43:20scenarios give me different details. And
43:22therefore, qualifying the points of
43:23interest is another step. For now, we do
43:25a 1 hour placeholder should be around
43:27this in terms of pips. The next one is
43:28going to be a decisional. The decisional
43:30is the same thing. You will qualify it
43:32on M5 later on, but a placeholder on the
43:341 hour time frame is fine until we
43:37arrive to it. Then I refine an M15 to
43:39look for reactions and M5 for entries
43:42when I found my refined pockets. And
43:44then the rest of them are irrelevant. In
43:46this case, I only have one irrelevant
43:47zone. But the reason that these are
43:49relevant always the initiation points is
43:51going to be the extreme. Always the one
43:53that broke structure from a previous
43:54external high, not internal high,
43:57external high. That's why you need to
43:59know the main pushes because you get the
44:00main push wrong. You got the wrong point
44:02of interest because you're looking for a
44:03main push that breaks through a previous
44:06external point. So this is the external
44:08point high. Where did it break? It did
44:10not break from this one. It broke from
44:11this one. All of these broke internal
44:13highs. This is one internal high. It got
44:15broken. This is another internal high.
44:16It got broken. This is another internal
44:18high. It got broken. I don't care about
44:20internal breaks. I care about external
44:22breaks. This is my external high. This
44:24is my external low. It got broken here.
44:27So when it finally breaks here, that is
44:29my decisional point of interest. The one
44:31that broke previous external high is
44:33going to be my decisional. Mark it on a
44:351 hour as a placeholder. As you get
44:37close, refine on it on M15, qualify on
44:39M5 with these pip counts in mind to make
44:42sure you got it right. And every other
44:43point of interest is going to be a false
44:46one, a trap one, a temporary one. Which
44:49one of those is going to be depends on
44:50how you arrive there with liquidity and
44:52intention on the day? What time of day
44:54you arrive there? How you arrive there?
44:55Do you arrive there with a
44:56consolidation? Do you arrive there with
44:58a wick down? Do you arrive there with a
44:59trend down? These are all going to be
45:00impactful because you're going to
45:02understand intent and control from these
45:03variations. But the point is don't buy
45:05in trap zones. Don't buy in weak zones.
45:08In fact, if you see a weak zone over
45:10here, I can look for sells down to a
45:12weak area knowing that this is a smart
45:14money trap zone and I find the
45:15inducement and flow because I know I'm
45:17targeting the decisional. So, this sell
45:19can be a great one and then knowing when
45:21to cut it because if I keep selling
45:23forever and forever thinking I'm in a
45:24bearish market, then you'll be rudely
45:26awakened when you realize the market has
45:28changed control because we're in my
45:30decision or extreme. So you can already
45:32disqualify a zone from what impact it
45:34had but then you can disqualify later
45:36from the M5 M15 read as well. So the
45:39reason by the way that these are trap
45:40zones is because of the structure cycle
45:42as we mentioned earlier is very simple.
45:44It has specific phases. You have the
45:46main push phase. You have the internal
45:47breakup structure phase. You have the
45:49complex pullback phase which is the
45:51internal trend. This is the external
45:52high. This is the external low. The
45:54decision was maybe down here. Internal
45:56high. Internal low. Internal low broken
45:58internal low. And then you have the
46:00efficiency of the pullback. So you have
46:01main push, internal break, two legs
46:03makes the complex pullback, eventually
46:05arrives to the end which is the
46:06efficiency of the pullback and now you
46:08expect a new main push. So those are the
46:09four phases. Main push, internal break
46:11of structure, complex pullback,
46:13efficiency of the pullback, back to the
46:15beginning, new main push. That is a
46:16structure cycle and they only happen for
46:19me to trade them in an extreme or
46:21decisional. A structure cycle does not
46:23have the efficiency pullback in a weak
46:25point of interest. No, it breaks through
46:27them. Maybe a temporary bounce, maybe it
46:29smokes through, maybe it gives a new
46:31liquidity run, but it will never break
46:33external ranges. External ranges are
46:35going to be only for decisional and
46:37extreme. That's why they count. So you
46:39got to get the trend right, the
46:41direction right, which phase of the
46:42structure cycle and which point of
46:44interest. You get one of those pieces
46:45wrong, you will get the wrong bias, then
46:47you will take a loss. This is why top
46:48down analysis matters from this
46:50framework. And the last step is going to
46:52be liquidity. Now, liquidity is my
46:54favorite because that is the best way to
46:56understand who's in control, where are
46:58they going and why are they interacting
46:59the way that they're interacting. Trend
47:01gives you a loose idea. Point of
47:02interest gives you roughly where, but
47:04liquidity tells you now who's in
47:06control, what they're doing. So, this is
47:08the biggest truth in the market. Trend
47:10can be misleading. Points of interest
47:11can be misleading. Liquidity can never
47:13be misleading because that is the oxygen
47:15of the market. The reason the market
47:16moves is liquidity. Why? This is not a
47:18buzz word. This is not a conspiracy
47:20theory. It's an owners market impact and
47:21market auctions. For every buyer in the
47:24market, there needs to be a seller. When
47:25you have a buyer meeting a seller and
47:28they agree on a price, they agree at
47:29what time and they agree the amount,
47:31then you have a deal. When you have a
47:33deal, that is an order placed in the
47:35market and that will naturally influence
47:37price. So if you have a buyer and a
47:38seller meeting and the buyer agrees to
47:40buy at a certain price point right now
47:42from the seller and then they enter into
47:44the market where they buy at this price
47:45point, they enter with a large enough
47:47volume, they will move price higher.
47:48This is known as market impact. And now
47:50when price is higher now sellers might
47:52think, oh this is a better price for me
47:53to sell. Buyers might start think it got
47:55a bit expensive. I'm no longer in. So
47:57now the dynamic changes. Each move in
47:59the market changes participation. Buyers
48:01are now taking profit if it goes up.
48:03Sellers are entering. Buyers may be
48:05thinking of a different perspective.
48:06Things might be priced in. Things might
48:08be hunting liquidity. This might be a
48:10new trend and people are jumping on it
48:11to flow with that trend. There's going
48:13to be multiple types of market auction,
48:15but that's always the flow. For a buyer,
48:17you need a seller. And what if there is
48:19not enough sellers and a buyer wants a
48:20big order? Now you have a liquidity
48:22problem because if the buyer wants a
48:24thousand and the sellers combined only
48:26have 200. If you have a deficit of 800
48:29orders at a specific moment in time at a
48:31specific price, how is that auction
48:33going to complete? Well, this is
48:34something I've spent a lot of time
48:35exploring with my podcast. I must have
48:37asked at least 50 institutional traders,
48:40hedge fund managers, quant traders,
48:41market makers, floor traders. I've asked
48:43all of them the same question. What is a
48:45market auction? What is liquidity? What
48:46is a stop loss hunt? What is the market
48:48mechanics? Why does price move the way
48:50that it does on intraday level? And what
48:51you will find unanimously from all of
48:53them will tell you the law of the market
48:56is market auction. Market auction is
48:58always going to create market impact.
49:00Now this is why you have dark pools.
49:02This is why you have spoofing. This is
49:03why you have icebergs. This is the
49:04interaction with order flow. But the
49:06basic premise is at a certain moment in
49:08time at a certain price point time over
49:11here. You have price over here you will
49:13look for a market auction at each moment
49:14in time at each price point. At this
49:16price point, you might have a,000
49:18buyers. At this price point, you might
49:20only have 200 sellers. So, how do you
49:22get another 800 sellers to get involved?
49:24What do sellers like? Well, sellers like
49:27higher price points. So, then you could
49:28drive price up. But now it just got
49:30expensive. Now, it just got expensive
49:32for the buyers because it went from this
49:33price to this price. So, simply allowing
49:35the market to naturally calibrate is
49:37ineffective for the buyers. So now they
49:39can accumulate or distribute where they
49:41say okay I can't enter at one point so
49:43I'm going to have an average price every
49:45time it naturally arrives to my level I
49:47will keep buying. So I buy a bit here I
49:49buy a bit here and you slowly get 100
49:51100 100 100 and eventually you build a
49:53position maybe you have to get in late
49:55another 100. So your average price
49:56instead of being over here at let's say
49:59$2, it might have to be your average
50:00price actually became here 2.2. So you
50:03now had an average higher price but
50:04eventually you got your order in. But
50:06what if the market didn't accumulate?
50:08What if the markets only gave this and
50:10then left and they could only get in
50:11there 200 or 300 orders of their desired
50:13thousand? This is inefficient. So that
50:15what the market will do to have an
50:17efficient market, the market makers will
50:19entice sellers to come in. What type of
50:22sellers do you have in the market?
50:23Because it's not just one type which is
50:24someone saying, "Hey, I want to sell."
50:25You have multiple types. This is where
50:27liquidity counts. Okay. So let's say we
50:29have now a very obvious support level.
50:31Price is respecting the support level
50:33because you have buyers, buyers, and
50:35buyers. And every time price came into
50:36this level, we had a bullish reaction.
50:38Buyers participation. Now, a basic
50:40understanding from a retail trader would
50:41be, oh, this is historically a strong
50:43level. Buyers have always interacted
50:45here. Therefore, it must be a relevant
50:47level. However, you don't understand
50:48depletion, exhaustion, and liquidity in
50:50the markets because the buyers that were
50:51here and then they have a small payoff
50:53and they got in here, they had the same
50:54small payoff here, small payoff. The
50:56buyers are hoping for price to come
50:57here. That is their full trade. But
50:59every time you get in, there's going to
51:01be people saying, "I'm out. I'm out. I'm
51:02out." more sellers are coming in saying
51:04there's a liquidity pool, there's a
51:06they're compressing price. You now have
51:07a range. So now you have maybe a
51:09thousand buyers over here and 20 sellers
51:12over here. But all of a sudden there's
51:13exhaustion. You might have 800 over here
51:16and then you might have 100 sellers and
51:18now you might have 400 more buyers, the
51:20additional buyers. These ones are
51:22already in. Now it's new participation.
51:24And now you have 800 sellers. And now
51:26over here you only have 200 buyers left
51:28because now accumulated across them all.
51:30Yes, you have 1,000 plus 800 plus 400
51:34plus 200. Yes, combined there are strong
51:36forces, but it only takes a few of them
51:38to say, you know what, I'm taking
51:39profits or a few of them to say, I'm no
51:41longer interested in adding more for
51:43exhaustion to happen. So, at the
51:44beginning, you have large participation
51:46and it weans off. So, by the end of it,
51:48when it's come to the the new touch on
51:50my support level, the participation is
51:52low even though the price level is the
51:54same known as exhaustion. But more
51:56importantly apart from exhaustion it is
51:58who is willing to sell and where are
52:00they willing to sell from because the
52:01sellers want to sell high not at the
52:03range low hoping it breaks because if it
52:05doesn't break they go into the negative.
52:06So now you have contrarian objectives
52:09but they need to meet for a trade to
52:10happen. This is why you enter
52:12consolidations because it's inefficient.
52:14Then you have efficiency where a market
52:16auction takes place they agree and then
52:18you have expansion. Consolidation in
52:20price where you have range always leads
52:22to expansion. But why and where is it
52:25going to expand? Bearish or bullish. And
52:27where is it going to go? It's depending
52:28on what auction took place. And if it
52:31doesn't happen here, it doesn't happen
52:32here, doesn't happen here, the range
52:33remains. But there will always be
52:34consolidation and expansion. Our job is
52:37to understand the market auction to know
52:38when it's ready and where it's going.
52:41Therefore, this is why it's important to
52:42understand trend because of foreshadows.
52:44Points of interest to know where the
52:45market auction and then liquidity to
52:47time it and to really understand
52:48control, intent, and institutional
52:50objective. So let's break it down from a
52:52market auction perspective. What is
52:54happening at these levels where people
52:55are entering levels? By the way, there's
52:57loads of them. There is a trend line
52:59level. There is a demand area level.
53:02There's going to be a Fibonacci level.
53:04There's going to be all types of levels.
53:05Support and resistance, double top,
53:06triple top patterns, head and shoulders,
53:08smart money sweeps, order blocks, fair
53:09value gaps. There's so many zones where
53:11people are going to be interested. My
53:13job is not to understand all of them. Is
53:15to understand liquidity. Because once I
53:16understand all of these things from
53:18liquidity, what becomes scattered,
53:20confusing because now I feel like I need
53:22to learn Elliot wave harmonics. I need
53:23to learn indicators. I need to learn a
53:25wickoff theory. This feels like there's
53:26all these things to learn. But in
53:28reality, none of it matters. The only
53:30thing that matters is liquidity. Why?
53:32Because at the end of all of these
53:33strategies, there's always an auction.
53:35And after an auction, there is always an
53:37expansion. So if my job is to enter when
53:39the market is about to move and know
53:41which way it is to move, that's how you
53:42make profits. Buy low, sell high. Then I
53:44need to know when is the low and where
53:46is the high and when is it going to
53:47happen. The only way to know that is
53:49knowing the trend, knowing the zone and
53:51timing it with liquidity to get it
53:53right. Okay. Now the next step is to
53:55understand how you get a mismatch and
53:56how you correct the mismatch. Okay. So
53:58remember about the market auction when
53:59there is no deal going on. Why? Because
54:01there's a thousand buyers but only 200
54:03sellers. How is there going to be a
54:05deal? They can participate in 200 but
54:07there is a deficit of 800. How do you
54:09get 800 new sellers at the price point
54:12and time buyers want it cheap or at the
54:14price that it's in, not expensive. So,
54:16how do you get more sellers? Well,
54:18sellers is you invite in more sellers.
54:20How do you invite in more sellers? Well,
54:21there could be bearish news, there could
54:23be a rejection, there could be technical
54:24patterns, but this is not it. These are
54:26going to be coincidental, but the
54:28institution, the buyer does not have
54:29control over this. So, this is where you
54:31have market manipulation, traps,
54:33engineered and inducements. Inducements
54:36differs from liquidity sweep. Why?
54:38Because inducement is broken up into two
54:41parts. You have entice or invite and
54:43then you have the take. Inducement
54:45comprises of these two things. Do you
54:47entice and invite participation and you
54:50take the liquidity? A sweep alone is a
54:52bit passive because you only take
54:54liquidity but you did not invite and
54:56entice participation. This is what it
54:58looks like. You have a support level.
55:00People are buying and buying and buying.
55:02Eventually you have exhaustion and
55:03depletion and weakness. So we can
55:05already see why price would slip lower
55:06because there is less buyers willingness
55:08but increasing selling pressure
55:10secondarily. So this is passive
55:12movement. You have active stop-loss
55:14placements. Where are these stop losses
55:16going to be? They're going to be in
55:17these areas. Right below the entry there
55:19is a stop-loss. So you're going to have
55:20stop losses of who? The buyers. The
55:23buyers entered over here. The stop
55:24losses are right below. What happens if
55:26I'm a buyer and I hit stop loss. Let's
55:28say I own gold and I bought it at a,000.
55:32Or let's be realistic. Let's say I
55:33bought it at 4,000 and now I am saying
55:35I've bought gold at 4,000. I want to
55:36hold it. But if it goes to 3,800, I
55:39don't want it anymore. It's not doing
55:41what I want it to do. I'm out. So if if
55:42I buy at 4,000, but I'm out at 3,800.
55:46When I hit stop loss, I say I don't want
55:48this anymore. I get rid of it and I
55:50become a seller. So notice how a buyer
55:53who owns it, who is hitting stop-loss,
55:55becomes a seller. Stop-loss placement
55:58and price driving to that stop-loss
56:01brings in buyers turning them into
56:03sellers. They're known as weak-handed
56:05buyers. So, weak-handed buyers who hit
56:07stop-loss equal sellers. This is what we
56:10needed. We needed more sellers. So, we
56:12took the weak-handed buyers and enticed
56:14them in to become the additional sellers
56:16we needed so that the institution could
56:18say, "Perfect, price has got better for
56:20me now. Price was over here. Now, it's
56:22cheaper. I've got all of these sellers
56:24offering it to me. So now my average
56:26price is not getting higher as in the
56:28previous example of accumulating. I've
56:30actually driven price lower to invite
56:32and entice in sellers. Not just the
56:34we-handed buyers. Remember if you have
56:36this range now you've got low, lower
56:38high, lower low. You've got a supply
56:39zone. You've got a trend line. You've
56:41invited in sellers and entice them in.
56:44Invite in new ones. Entice in new ones
56:46and take the liquidity of the existing
56:48weak-handed buyers. All of a sudden from
56:50price having a support level dipping
56:52lower 20 pips, five pips, seven pips,
56:54all of a sudden you had a mass liquidity
56:56event and a big auction take place at a
56:59more favorable price for the buyers.
57:01This is the key for me. This is real
57:04efficient liquidity in the market at a
57:06better price point. And after that
57:07consolidation, you have a liquidity
57:09event, a big auction take place. And
57:11remember at the beginning we said law of
57:13self-fulfilling. When a large
57:14institution places a large order, price
57:16must react and go higher. This is market
57:19impact. My job as a trader is to not
57:21create the trend. Is to not predict the
57:23trend. Is not know to which trend to
57:25pick. Is to predict and understand and
57:27react to a market auction leading to a
57:30market impact. And I surf this wave. I
57:32don't create the wave. I don't predict
57:34where the wave is going. I don't know
57:35how fast it's going to go. My job is to
57:37understand when and where and why. Once
57:40I understand that I am now surfing an
57:42institutional wave and I'm trading
57:44market impact with liquidity at the
57:46right time at the right place with the
57:48right direction. These three things
57:50connected is the objective of a top down
57:52analysis. Now this is a basic overview
57:54of market auction. But let's make it a
57:56little bit more practical. So now you
57:58understand what a liquidity event is.
57:59Now you understand what a liquidity
58:00sweep is versus an inducement. Now you
58:03understand that this area brings in
58:04institutional participation. This
58:06creates a large wave in the market to
58:07market impact and therefore this creates
58:09opportunity and it's better than general
58:11trend analysis because trends can
58:13weaken, trends can change. But what
58:14cannot is market impact. If you have a
58:17liquidity sweep and an inducement, you
58:18will always have a reaction. Before a
58:20big move, there's always an inducement.
58:22This is where a big auction takes place.
58:24With a big auction happens, a big move.
58:26This is the whole point. If you know
58:27where these auctions are taking place,
58:29which direction they're taking place,
58:30you're always going to be on the right
58:32side of the market. However, we know
58:33what a market auction is, but we don't
58:35know where it's going to take place,
58:36what types there are, what are the
58:37strong ones, what are the fake ones,
58:38what are the traps. This is where you
58:40got to break down liquidity into a few
58:41portions. That's going to be what are we
58:44taking liquidity of? What is the impact?
58:46These two questions I need to ask and
58:48it's going to be broken into
58:49subcategories, which is is it existing
58:51liquidity or is it engineered liquidity?
58:53So, when I break these into four parts,
58:55this is going to give me a clear answer.
58:56So, with that existing and engineered
58:58liquidity, there's going to be two
59:00types. You're also going to have another
59:01question to ask which is type of
59:03liquidity and interaction. All of a
59:05sudden you have a grid now and our job
59:08is to answer which quadrant are we in
59:10and what's going on. So what are the
59:12types of liquidity? You can have a trend
59:14line. You could have support and
59:16resistance. You can have pattern. You
59:18can have SMC zones like an order block,
59:21a demand area or supply. You can have
59:23breakouts break and test. There's going
59:25to be many more. There's going to be
59:26previous day high, previous week high,
59:28previous session high, Asia range, Asia
59:30midline, and of course, these are going
59:32to be dynamic. And then you also have
59:33local buildups, a temporary
59:34consolidation. It could be a trend line
59:36on the 5minut time frame, it could be a
59:37trend line on the 15, it could be a
59:38trend line on the daily. So all of these
59:40categories of liquidity, the type of
59:42liquidity we need to qualify it.
59:44Therefore, that comes into interaction.
59:46Interaction means how big of a liquidity
59:48pool is it. Obviously, M5 resistance is
59:51not going to be the same as a daily
59:52trend line. Obviously, there's more
59:54liquidity to be taken on the daily trend
59:56line because there's more people, more
59:57liquidity, more participation, more
59:59orders, therefore more impact, therefore
1:00:01bigger market auction. But if it's just
1:00:03a resistance level created in 5 minutes,
1:00:05it's two touches to 10 pip range.
1:00:08Obviously, there's only a little bit of
1:00:09participation there, a little bit of
1:00:10liquidity. So, time frame matters, but
1:00:12it's not only about time frame because a
1:00:14daily time frame is not superior to a
1:00:16previous day high, for example, or to a
1:00:18previous session high. It depends on the
1:00:20type of liquidity with the interaction
1:00:22and where it is. This is where it comes
1:00:24into existing and engineered liquidity
1:00:26to qualify and prioritize them. So the
1:00:28undertone is always going to be time
1:00:30frame. Higher time frame is going to be
1:00:32generally better, but there's going to
1:00:33be a better engineered guide. So on all
1:00:36time frames, you're going to have
1:00:37existing liquidity and engineered
1:00:38liquidity. On all time frames, you're
1:00:40going to have trend lines, support and
1:00:41resistance, break and test, smart money
1:00:43zone, supply and demand, all time
1:00:44frames. And you're going to have the
1:00:45category, the interaction which is
1:00:48minor, medium, and major. That doesn't
1:00:51automatically mean time frame. It means
1:00:53impact. For example, if I have a bullish
1:00:55main push, that's my external low.
1:00:57That's my external high. And then I have
1:00:59my bearish internal trend. So I have my
1:01:00bearish internal push. If I now grab
1:01:02liquidity over here, yes, it's a
1:01:05structural inducement. It's a medium
1:01:07inducement though. Why? Because it took
1:01:09internal liquidity. It's inside my
1:01:12bigger range. But if I take this high
1:01:14again the same thing this is a supply
1:01:15zone getting induced. However, external
1:01:18is going to be more important even
1:01:19though I looked at both of them on the
1:01:20daily time frame. External is going to
1:01:22be major internal is going to be medium.
1:01:25So you can now start to categorize them.
1:01:27Obviously if it's just a session
1:01:28consolidation a session structure point
1:01:30for example I have an M5 trend and then
1:01:32I take liquidity of the M5 higher low to
1:01:34now make a new M5 higher high. That is
1:01:36going to be a minor inducement. So
1:01:38qualifying it is going to help me
1:01:39understand better. So when I start to
1:01:41see I have trend line liquidity that is
1:01:43medium inducement and then I see where
1:01:46it happened. Where it happened means is
1:01:48it existing or engineered what time it
1:01:50happened what place it happened. So this
1:01:51is becomes the next qualification. So
1:01:53what does engineered mean? Engineered
1:01:55means you have a structure you have a
1:01:57trend you have whatever and then price
1:01:58has now all of a sudden created a trend
1:02:01line liquidity like this. Price has
1:02:03induced it and then gone. So yes we made
1:02:05a high in the market that made a new
1:02:07high in the market structure. Yes. But
1:02:09the key was the trend line invited and
1:02:12enticed buyers because they're going to
1:02:14be buying on the market structure.
1:02:15They're going to be buying on the trend.
1:02:17Where is their stop losses? Stop losses
1:02:18are naturally right below like so. And
1:02:20what is going to happen when you break
1:02:21the trend line? You're going to get
1:02:22break test continuation sellers. You're
1:02:24going to get supply zones interactions.
1:02:26So therefore, you invited in sellers who
1:02:28saw the break and test who saw the
1:02:29supply zone and you also took the
1:02:31weak-handed buyers out. So you had a big
1:02:33market auction, an influx of sellers. So
1:02:35now the buyers can say, "Thank you very
1:02:36much. I have a large buy position.
1:02:38Self-fulfilling means market impact in
1:02:40that direction. So that is engineered
1:02:42liquidity. Price had a deficiency
1:02:45created a scenario got the efficiency.
1:02:47So we had lack of liquidity. We created
1:02:50the opportunity that we took the
1:02:51liquidity. That is engineered liquidity.
1:02:53It can be our trend line, support and
1:02:55resistance. It can be any of these
1:02:56things and it can be minor, medium,
1:02:57major. So all of these going to exist.
1:02:59But the separation is existing liquidity
1:03:01or engineered liquidity. Always knowing
1:03:03your premium and discount. Better if
1:03:05it's in a point of interest. better if
1:03:07it's with the trend. So now you're
1:03:08connecting things together. What does it
1:03:10mean premium and discount? If I have a
1:03:12bearish market like so, I want to be
1:03:14above the 50%, so in this area, I want
1:03:17to see existing liquidity or engineered
1:03:19liquidity above the 50%. So if I start
1:03:22to get a trend line and I induce it like
1:03:24this, that doesn't mean I'm selling
1:03:25because I'm in discounts. I'm at the
1:03:26bottom of a trend. So even if I get a
1:03:28minor inducement of a trend line, but
1:03:30it's below the 50%, it's in discounts.
1:03:32It's not a trade for me. So if I get
1:03:34existing or engineered liquidity in my
1:03:36point of interest in premium, whether
1:03:38it's a trend line, whether it's a medium
1:03:40inducement, whether it's a smart money
1:03:41sweep or a major inducement, it doesn't
1:03:42matter. It matters where and then when
1:03:45because an inducement happening at Asia
1:03:46time is not going to be as important as
1:03:48an inducement happening at Frankfurt.
1:03:50Frankfurt is usually a trap sweep.
1:03:52Frankfurt inducements are usually false.
1:03:54So I need to know my trap time, my weak
1:03:56time, my preferred time, and my optimal
1:03:58time. preferred is going to be a New
1:04:00York open or a London close, but optimal
1:04:02is going to be my key time windows.
1:04:03London open 1 hour, New York key time
1:04:06window, the second hour. So I have my
1:04:08weak times, trap times, preferred times,
1:04:11and optimal times. So then I can start
1:04:13to say, have I got an existing liquidity
1:04:15pool, a trend line, having a medium
1:04:17inducement during my London open, go
1:04:19time. However, if I have a breakout
1:04:22liquidity that was engineered but it
1:04:25happened during Asia and it was a minor
1:04:28inducement, I'm not interested. If it
1:04:30happened during Frankfurt, it's a trap.
1:04:31So, I need to know time markers, zone
1:04:34markers, types of liquidity, intention
1:04:37and interaction with existing or
1:04:38engineered liquidity. So, the last piece
1:04:40of the puzzle is what is existing
1:04:42liquidity? We just covered engineered.
1:04:43Existing liquidity is going to be as it
1:04:45says markets already had liquidity
1:04:47passively there and the market just
1:04:49happened to take it. What that would
1:04:50look like is in a bearish trend in the
1:04:52market lower high that made a lower low.
1:04:54It's going to be a case of in that range
1:04:56price maybe did a bit of a support level
1:04:59before continuing lower. So when price
1:05:01comes back up to this area it may not
1:05:03just interact and respect that supply
1:05:05zone because there's a pool of liquidity
1:05:07that's already existing. So if there's a
1:05:10failed auction, there's a lack of
1:05:11liquidity, what is the market going to
1:05:13do? The market will say, "I've got an
1:05:14idea." The market maker, the institution
1:05:16in control will say, "Let's bump price
1:05:18higher just a little bit." Because
1:05:19what's going to happen if price goes
1:05:21higher? More sellers are going to come
1:05:22in because it's at a higher price point,
1:05:24inviting in sellers. What else is going
1:05:26to happen? All of these sellers that hit
1:05:28stop-loss became buyers. And if these
1:05:31buyers are coming into the market by
1:05:32hitting stop-loss, the sellers are going
1:05:34to add more positions. So you have
1:05:36passive sellers coming in because it's a
1:05:37better price point. aggressive sellers
1:05:39coming in saying, "Thank you,
1:05:40weak-handed sellers. I'm taking your
1:05:42liquidity because you hit stop loss."
1:05:43And you're also getting break test
1:05:45continuation. You're getting in more
1:05:47buyers into the market. So, the sellers
1:05:49can say, "Thank you very much. I'll take
1:05:50your liquidity." This was existing
1:05:52liquidity. The market maker institution
1:05:54used when they needed it. Engineered is
1:05:56when they created it. Existing is when
1:05:58it already existed. The main point is
1:06:00you need to know is it in the right
1:06:01direction? Is that at the right place?
1:06:03If it's not in the right place, is it
1:06:05roughly in the premium discount and
1:06:07timing? And then what type of liquidity
1:06:09and what type of interaction. When you
1:06:11have this matrix, you have mastered
1:06:12liquidity. This is a rough overview. It
1:06:14gets a lot deeper, especially when you
1:06:16start to do this on the daily time
1:06:17frame, the 4-hour time frame, the M15
1:06:19and the M1, and you're connecting it
1:06:21because you might have a major
1:06:22inducement on the daily and M5 high
1:06:24previous day sweep happening in London
1:06:25open. It's going to be different
1:06:26pictures. They're in different
1:06:27directions. You need to know how to
1:06:28navigate it. But this is what you're
1:06:30looking for in a top down analysis. Not
1:06:31just trend lines, points of interest,
1:06:33and looking for the buy easily like
1:06:35that. No, because these will lead to
1:06:36traps. These will lead to fake outs and
1:06:38you will often be the existing or
1:06:40engineer liquidity if you passively
1:06:42trade those common rudimentary retail
1:06:44strategies. But the moment you
1:06:45understand main push is bullish for my
1:06:47intraday. I'm in my demand area that is
1:06:50a decisional and I'm starting to get
1:06:52existing liquidity taken during my
1:06:54Frankfurt open and during London open.
1:06:56I'm getting my engineered SMC zone taken
1:06:59with a medium inducement during my
1:07:01London open. All of a sudden you have a
1:07:03very clear setup. Even though it might
1:07:05seem basic, these are the steps you
1:07:07follow not just to find a good trade
1:07:09because that's easy. The benefit is you
1:07:11know when not to trade. You know which
1:07:13areas to avoid. You know when there's a
1:07:15trap in the market presenting.
1:07:17Therefore, I believe it's more important
1:07:19in not finding more winning trades.
1:07:20Although this is super important, it's
1:07:22in eliminating invalid losses. The only
1:07:25way you can eliminate invalid losses is
1:07:27by understanding what is invalid.
1:07:29Invalid is going to be through this
1:07:30foundation we've built as a top down.
1:07:32Once you know what's an invalid zone or
1:07:34an invalid trend or an invalid liquidity
1:07:36pool, all of a sudden you're not taking
1:07:37a trade when you normally would have.
1:07:39So, you optimize it through these
1:07:40lenses. And in the next video, what I'm
1:07:42going to do is I'm going to take all of
1:07:43this theory that I've drawn out today in
1:07:46a part two where I'm going to break it
1:07:47down with price action. I'm going to
1:07:48show you real examples because remember,
1:07:50I built a career of trading this style
1:07:53for a decade. I made millions of dollars
1:07:55myself and most importantly in the last
1:07:57month with my my effects book with my
1:07:59broker statements with everything that
1:08:00you've seen on this channel and most
1:08:02importantly the live call outs with the
1:08:03public signals every trade I took I gave
1:08:05it publicly the before the during and
1:08:07the after leading to 100% return in the
1:08:09last month $158,000
1:08:11verified and again a three-year track
1:08:14record which you can check yourself in
1:08:15the description. When you have all of
1:08:17this proof and transparency, hopefully
1:08:19you'll start to think differently.

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