This is Everything YOU Need To Know About LIQUIDITY — Transcript

Full transcript

1. 0:00What's going on guys? Welcome back to a
2. 0:02brand new Inter Equity Trading video.
3. 0:04Today is going to be a very very
4. 0:07important video. I'm going to be
5. 0:08breaking down everything to do with
6. 0:11liquidity. Who is getting induced, where
7. 0:13the liquidity is, who's going to be
8. 0:15getting trapped next, and of course one
9. 0:18very very important rule everyone needs
10. 0:21to know. Sit back, enjoy, drop a like on
11. 0:23this video if you want to see more
12. 0:24videos like this in the future, and of
13. 0:26course comment down below. We read all
14. 0:28of your comments. Let us know down below
15. 0:30what kind of videos you want to see from
16. 0:31us in the future. Enjoy.
17. 0:41All right. So, you guys hear me talk a
18. 0:43lot about inducements. Who's getting
19. 0:45induced? Now, what does that exactly
20. 0:48mean when I say who is induced? When I
21. 0:51say this, when I use this word
22. 0:53inducement, you have to understand what
23. 0:54it means. Who is induced? Now, when the
24. 0:57market has all of these different types
25. 0:59of moves that occur, whether we're
26. 1:00trading to the upside or we're trading
27. 1:03to the downside, you have to understand
28. 1:05that every single time the market has a
29. 1:07move up or the market has a move down,
30. 1:09it is an inducing traders a specific
31. 1:12way. So, an example would be if we are
32. 1:14trending to the upside, every single
33. 1:17time we make a new high, right? This
34. 1:19this bullish leg here from circle to
35. 1:21circle, we are inducing buyers after
36. 1:24taking out previous highs. Watch what it
37. 1:26does again. Sell off, we go bullish
38. 1:28again. The intention behind this move,
39. 1:30you have to think about this from a
40. 1:32psychology perspective almost, okay? Not
41. 1:34from a pattern, but from a psychology
42. 1:35perspective. Big move to the upside
43. 1:37trading above old highs, the market sees
44. 1:41that as momentum, okay? So, it induces
45. 1:43buyers to get into the market again. And
46. 1:46the market goes down again. Again, low
47. 1:49to high, taking out new highs, we now
48. 1:52induce buyers. Once the market induces
49. 1:54enough buyers in one direction, that's
50. 1:57typically when you'll see
51. 1:59that occur. And that's the that's the
52. 2:00moves we're typically catching. On the
53. 2:03flip side, we have the market trending
54. 2:05to the downside, right? So, if I just
55. 2:07leave this drawing on, we've taken out
56. 2:09previous lows, low to high.
57. 2:12Again,
58. 2:13who is induced? Sellers are induced. And
59. 2:15now we're going to plot some annotations
60. 2:17on to make your guys' life a little bit
61. 2:18easier here. We have a BOS to the
62. 2:21downside. So, low to high Sorry, high to
63. 2:25low, we induce sellers into the market.
64. 2:28So, now typically, if there's a
65. 2:29pullback, these are regions sellers are
66. 2:31looking to enter the market, okay? And
67. 2:33this is very important. You want to
68. 2:34understand, you want to
69. 2:36have a good idea of who is trying to get
70. 2:38into the market. So, this is an example
71. 2:40of sellers being induced in the market,
72. 2:42and of course, the previous one would be
73. 2:44buyers being induced into the market.
74. 2:46It's not just that easy, okay? We all
75. 2:48know that. If everything was just ABCD,
76. 2:50we'd all be millionaires by now, right?
77. 2:52So, things get complicated sometimes,
78. 2:53and I'm going to give you guys some good
79. 2:55examples. What typically happens
80. 2:56sometimes is let's say the market,
81. 2:58again, trends to the upside. We take out
82. 3:00old highs, and we're printing new highs.
83. 3:03We understand,
84. 3:05after what we just went through, buyers
85. 3:07have been induced, right? So, if the
86. 3:08market
87. 3:10pulls back into this region down here,
88. 3:12we don't want to be buying in here,
89. 3:14okay? Very important. We do not want to
90. 3:16be buying. But typically, what can
91. 3:17happen sometimes is the market can
92. 3:18respect it and go long. Now, just
93. 3:21because we have respected this low here
94. 3:23and gone long does not mean we
95. 3:25immediately have to look for sells back
96. 3:26down. No. What you need to understand is
97. 3:29buyers have been induced.
98. 3:31Now, they have entered the market. It
99. 3:32pushes in their intended direction, and
100. 3:34we we now have left liquidity for later
101. 3:37on. Very, very important. So, again,
102. 3:40buyers induced here.
103. 3:42We get a pullback into their area. This
104. 3:44is where retail want to be longing. It
105. 3:46goes long in their intended direction.
106. 3:48Now, there is liquidity left for the
107. 3:50future. And if I just draw this out on
108. 3:52the flip side, just like we talked about
109. 3:54in the in the past, this would be that
110. 3:56BOS for retail. They want to be selling
111. 3:59on the pullback. They enter positions
112. 4:01here, and look, it goes in their
113. 4:02intended direction. Now, we understand
114. 4:04this is going to be future liquidity
115. 4:06that we can target, whether we're going
116. 4:08to be buying into it or, very important,
117. 4:11selling out of it. So, in this example,
118. 4:13we could typically sell into it or if
119. 4:16the market is still bullish, we would
120. 4:17buy out of it. In this example, we could
121. 4:20buy into it. However, if the market's
122. 4:22still bearish, we could sell out of it.
123. 4:24Very, very important. Moving on to the
124. 4:27next topic, which is going to be kind of
125. 4:29relative to what we talked about, but
126. 4:31still very important. That is going to
127. 4:33be
128. 4:34structure liquidity. So, going back to
129. 4:36what we just spoke about, who is
130. 4:37inducing the market, if I draw
131. 4:41price like this, simple, highs, lows,
132. 4:44highs, lows. From a structure
133. 4:46perspective, this is where the liquidity
134. 4:48is going to be, and that lines up
135. 4:49perfectly what with what we were just
136. 4:51talking about. Structure traders would
137. 4:52be buying down here. They would have
138. 4:54liquidity left at the lows down here,
139. 4:55and of course, on the flip side, this is
140. 4:57now known as our structure liquidity,
141. 5:00right? We all understand, very similar
142. 5:01to what we were talking about. So, now
143. 5:02we understand who is induced. Now, we
144. 5:04understand where the liquidity is. Okay,
145. 5:06so to simplify this as much as possible,
146. 5:09and I'm going to title this here,
147. 5:10liquidity. If you guys come from a
148. 5:12retail perspective, this will be very
149. 5:14familiar to, but above
150. 5:18liquidity above lower highs. So, this
151. 5:21would be your lower high, lower high,
152. 5:23liquidity above. And on the left side,
153. 5:25we have liquidity below higher lows. Cuz
154. 5:29again,
155. 5:30when there's a trending market, you guys
156. 5:31can call it. I don't look at the market
157. 5:33from that perspective, but from a
158. 5:34trending market, you have your high,
159. 5:35higher low, high, higher low, right? So,
160. 5:37there's going to be liquidity below the
161. 5:39higher lows. So, that's why we call it
162. 5:41structure liquidity. And on the flip
163. 5:42side, lower high, low, lower high, and a
164. 5:46new low, there's going to be liquidity
165. 5:47above your lower highs. Every single
166. 5:50time the market takes out new lows, just
167. 5:52to summarize this, we have induced
168. 5:53sellers. On the flip side, we take out a
169. 5:55high, we have induced buyers. Take out a
170. 5:58high, we have induced buyers, leaving
171. 5:59liquidity to the downside, identifying
172. 6:02it as structure liquidity. So, now we're
173. 6:04piecing everything together. I'm
174. 6:06actually going to leave these two
175. 6:08drawings on right now, and we're going
176. 6:09to talk more about this. How do we take
177. 6:11advantage of this, and how do we trade
178. 6:13this? So, with the understanding Okay,
179. 6:15so with the understanding of we knowing
180. 6:17now that price has left liquidity above
181. 6:21this high, and price has left liquidity
182. 6:23below this low. How do we take
183. 6:25advantage? Right? That's what everybody
184. 6:27wants to know. How can we take our
185. 6:28trades based off this knowledge in front
186. 6:30of us right now? If we can talk about
187. 6:31the left side first. What everybody
188. 6:33seems to make the mistake of doing is
189. 6:37not waiting for that false move to
190. 6:40occur. That's what I like to call it,
191. 6:42that false move. If we don't have that
192. 6:43false move, that trap move, then we
193. 6:46don't have a trade. So, look at this.
194. 6:48Price has left liquidity at the lows,
195. 6:50otherwise known as structure liquidity.
196. 6:52Now, we have to wait for, and sometimes
197. 6:54this can happen Again, look, we left
198. 6:57more liquidity at the lows. We need to
199. 6:59wait for this. And that's what leads me
200. 7:02to that very, very important rule we've
201. 7:05discussed in the intro that everybody
202. 7:07should have in their plan. And that is
203. 7:09going to be we must only trade once the
204. 7:15early traders are trapped. Now, let's
205. 7:19talk about this once some more. We must
206. 7:20only trade once the early traders are
207. 7:23trapped. Now, what are the early
208. 7:25traders? In this example in front of us
209. 7:28right now, let's talk about this. Who
210. 7:29are the early traders? The structure
211. 7:31traders here, right? The people that
212. 7:33have entered positions here, the people
213. 7:34that have entered positions here. Those
214. 7:36are going to be your early traders. On
215. 7:40the bearish example, sellers stepped in
216. 7:41the market here, maybe the market pulled
217. 7:43back once more just like in the other
218. 7:45example and sold off again. Where are
219. 7:46your early traders going to be? Right
220. 7:48here.
221. 7:49In order for us to take a trade, what do
222. 7:51we need to see? We need to see them get
223. 7:54trapped. So, I hope you guys are
224. 7:56starting to make sense of all this.
225. 7:57Again, early traders are in the market
226. 7:59here. Early traders are in the market
227. 8:01here. We need to wait for them, again,
228. 8:03to get trapped. So, what does that look
229. 8:04like on the sell example? The market
230. 8:06goes bullish, traps the sellers out, and
231. 8:09then take advantage of this move right
232. 8:11here. So, if the market is still
233. 8:13bearish, and this is very important,
234. 8:14right? So, I'm going to write this here,
235. 8:16bearish market. We can be taking the
236. 8:18sells above the highs, okay? As long as
237. 8:20the market is bearish, of course. So,
238. 8:22what does that mean? If we still have
239. 8:24liquidity to the downside here, okay?
240. 8:26I'm going to draw that line and we're
241. 8:27going to mark this on as liquidity. So,
242. 8:29we still have, again, liquidity to the
243. 8:31downside. So, this is a bearish market.
244. 8:33You want to be taking that sell above
245. 8:34the highs once the sellers are trapped.
246. 8:38Now, if we talk about this on the
247. 8:39bullish example, if we are still in a
248. 8:41bullish market here, we have liquidity
249. 8:44to the upside, basically with this line
250. 8:46we have at the highs here. So, again,
251. 8:47liquidity to the upside. We can be
252. 8:49taking longs below these lows and,
253. 8:52again, targeting that liquidity to the
254. 8:53upside. So, it's very important to
255. 8:55understand that this false move, we need
256. 8:58to wait for this false move to occur.
257. 8:59So, I'm going to circle it here from the
258. 9:01high
259. 9:02to low.
260. 9:03And on the sell side, you need to wait
261. 9:05for this low
262. 9:07to print this high here. And again,
263. 9:09that's when we are looking for the
264. 9:10sells. Once the early traders, and
265. 9:12that's a rule. I need everybody, if you
266. 9:14trade how I trade, you need to write
267. 9:15this rule down. We must only trade once
268. 9:17the early traders are trapped. No if,
269. 9:20ands, or buts. All right, here in front
270. 9:22of us I have a piece of price action.
271. 9:25The pair, it's irrelevant, but I'm going
272. 9:26to be talking about everything we just
273. 9:28spoke about in the diagrams, okay? So,
274. 9:31understanding structure, liquidity, who
275. 9:32is induced, all of these good things.
276. 9:34So, with this chart we have in front of
277. 9:36us right now, if we can just backtrack,
278. 9:38follow my cursor, look how all of these
279. 9:40lows being respected here. This market
280. 9:43this low respecting lows to the
281. 9:44left-hand side all the way up until
282. 9:47which point? This point here. So, if I
283. 9:49can circle this, actually know what? I'm
284. 9:51going to put an arrow to this piece of
285. 9:53price action right here. That piece of
286. 9:54price action is simply just this,
287. 9:57leaving liquidity to the downside. Okay,
288. 10:00so you simply want to mark on this low.
289. 10:02Now, this is where again everybody
290. 10:04screws up. You want to wait for these
291. 10:06lows to go. Okay, cuz look, after we
292. 10:08take out this high, we understand buyers
293. 10:10have been induced. This is a level of
294. 10:12structure liquidity. Look at the market
295. 10:14does. Once respects it and then goes
296. 10:17long leaving even more liquidity to the
297. 10:19downside. So, this whole price action,
298. 10:22look how inconsistent. This is very
299. 10:24important, guys. Look how inconsistent,
300. 10:25look how rangy it is. This is
301. 10:27accumulating liquidity. If we understand
302. 10:30where the liquidity is, aka the
303. 10:32structure liquidity right here, we want
304. 10:35to wait for these lows to get taken out.
305. 10:38Okay, cuz once they get taken out, the
306. 10:40early traders, remember we spoke about,
307. 10:42we must wait for early traders to get
308. 10:46trapped. And that would be right here.
309. 10:49Your early traders stepped in here,
310. 10:50liquidity is going to be below the lows.
311. 10:52Okay, this is just going to be a massive
312. 10:54range, a massive build-up, okay, of
313. 10:57early buyers essentially. And as soon as
314. 10:59these lows go, that's when you want to
315. 11:00start looking for your buy back up. And
316. 11:02of course, remember, if we are in a
317. 11:04bullish market, that buy below these
318. 11:06lows remain valid into the next level of
319. 11:09liquidity. And look what we have at the
320. 11:10highs here. Sellers stepped in the
321. 11:12market here, all right? And to make this
322. 11:13as easy as possible, look at this circle
323. 11:15respecting this area to the left-hand
324. 11:17side. So, we have left a level of
325. 11:19liquidity. So, this is a bullish market
326. 11:21once we trap the early buyers still,
327. 11:23which means we can take that buy back
328. 11:25up. And look what happens if I play this
329. 11:27price piece of price action out.
330. 11:29Again, we struggle here, induce even
331. 11:32more early buyers. Finally, look at
332. 11:34this. The liquidity has take taken out
333. 11:36from the left-hand side, that structure
334. 11:38liquidity is trapped and taken out. We
335. 11:41get a nice sell-off here, and look at
336. 11:43that sharp reaction out. And look at the
337. 11:45swift again, we want to be involved in
338. 11:49these type of moves here. And if I just
339. 11:51look at that. So,
340. 11:52again, avoid this kind of price action.
341. 11:55You don't want to be trading this kind
342. 11:56of price action. This is the price
343. 11:59action you want to be involved in. And
344. 12:00just to put this into perspective for
345. 12:01you guys, this is very, very important.
346. 12:04From the point where we started building
347. 12:05liquidity, look at this. 5 days of price
348. 12:08action. And then all it took was 18
349. 12:11hours for us to swallow all of that
350. 12:13price action up. So, imagine you're in a
351. 12:15position down here at the lows.
352. 12:17Okay, stop below, targeting the highs.
353. 12:20That price action that took 5, 6 days to
354. 12:23build up got taken out in less than a
355. 12:25day. Okay, think about that for a
356. 12:27second. So, all the early traders are
357. 12:29trapped, that's why the market has that
358. 12:32expansion to the upside. Okay, now I
359. 12:34have another piece of price action in
360. 12:35front of us right here. Okay, so check
361. 12:37this out. Remember we talked about
362. 12:39leaving liquidity for later. Remember we
363. 12:40spoke about that in the very beginning
364. 12:42of the video. Now, look at this piece of
365. 12:43price action down here. I'm going to
366. 12:45circle it. Very simple, don't
367. 12:46overcomplicate this. Look.
368. 12:49We take out a high, price comes back,
369. 12:51and look at all these lows left intact.
370. 12:53Price comes back, and we go long. See
371. 12:55this? Price comes back, and again, we go
372. 12:57long. So, let's remove these drawings.
373. 12:59Let's make this the simplest possible. I
374. 13:00circled this up so that we have left
375. 13:02liquidity here. We have left liquidity
376. 13:04here.
377. 13:05Right? So, this is going to be a future
378. 13:07target. Okay, yes, we couldn't take
379. 13:09longs in this current moment, but the
380. 13:11market has simply engineered liquidity
381. 13:14for us to now, what? Sell into. Remember
382. 13:17how I talked about we can usually sell
383. 13:19into it, or if the market's bullish, you
384. 13:21could buy out of it. In this example,
385. 13:23the market is bearish, so we're going to
386. 13:24be selling into it. Talking about the
387. 13:27current price action we have in front of
388. 13:28us. Who is induced? You want to ask
389. 13:31yourself that. After we take out this
390. 13:32low,
391. 13:35we have sellers induced. The market
392. 13:37pulls back, respects the level on the
393. 13:40left-hand side, and sells off again. So,
394. 13:42we spoke about the we literally had
395. 13:43diagrams talking about this piece of
396. 13:45price action. But, look at all this
397. 13:46liquidity we've now left to the upside.
398. 13:48These are what? I hope you guys are
399. 13:50saying this in your head. Your early
400. 13:52sellers. And remember that rule I told
401. 13:54you guys about? You want to wait for
402. 13:56these early sellers to get trapped
403. 13:58before looking for your sells. This
404. 14:00requires patience. And this talks about
405. 14:03and this goes back to what we were
406. 14:04talking about before, how you need to
407. 14:06wait for that false run to occur. So,
408. 14:09what do I mean by that? You want to wait
409. 14:10for price to come back up, trap out the
410. 14:12sellers, and of course, if we are in a
411. 14:14what? Bearish market,
412. 14:17this could possibly provide us an
413. 14:19opportunity to sell back down, okay?
414. 14:21Into liquidity here. And then of course,
415. 14:23liquidity on the left-hand side we
416. 14:25previously spoke about. So, let's see
417. 14:26what happens here. We take out lows. So,
418. 14:28I'm going to copy and paste this cuz
419. 14:30sellers are induced, aka the early
420. 14:33traders. Then the market goes long, and
421. 14:35look at this. Where do we hunt for? Big
422. 14:36surprise, we come all the way back to
423. 14:38trap out the early sellers. Don't
424. 14:41forget, we're in a bearish market, so
425. 14:42price could be delivering us an
426. 14:44opportunity to sell back down. We're not
427. 14:46talking about entries here. We're not
428. 14:47talking about how to actually enter the
429. 14:49market. That's in previous videos. We
430. 14:51have all of our We have all over the
431. 14:53YouTube channel already. This is
432. 14:54specifically going to be a what we are
433. 14:56speaking about in the beginning of the
434. 14:57video, which is going to be early
435. 14:58traders. So, again, the early sellers
436. 15:00and early buyers, waiting for them to
437. 15:01get trapped. We had that move to the
438. 15:03upside, so I'm going to circle it. You
439. 15:04guys are going to see a little pattern
440. 15:06here about what we spoke about in the
441. 15:08diagrams, low to high
442. 15:11opportunity to sell back down into the
443. 15:14lows. And look what happens. If I zoom
444. 15:17out, remember, from when we started
445. 15:19building liquidity, I'm going to show
446. 15:20you guys the perspective on this
447. 15:21quickly,
448. 15:22To where when we took it out, 4 days and
449. 15:2513 hours. Okay? So, 4 and 1/2 days
450. 15:28basically, we had a build-up of
451. 15:29liquidity. And then,
452. 15:32rapid move back down from when the highs
453. 15:34got taken to when the lows got taken, 19
454. 15:37hours. So, 25% of the time, a quarter of
455. 15:40the time it took for price to build,
456. 15:42build, build. Again, we don't want to be
457. 15:43trading this price action. This is when
458. 15:46we want to trade. After the sellers have
459. 15:48been taken out, aka that rule we've been
460. 15:50speaking about this whole video, waiting
461. 15:52for those early traders to get trapped.
462. 15:55Yes, guys, I hope you enjoyed today's
463. 15:57video. If you do want to see more videos
464. 15:59just like this one, drop a like down
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466. 16:03all of your comments. Let us know what
467. 16:05kind of videos you want to see from us
468. 16:06next. Without further ado, thanks so
469. 16:07much for watching. See you in future
470. 16:08videos.