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You wait for this candle. You put the stop loss here. You target either. This is the main reason why a lot of traders lose money. They try to anticipate what the market is doing before the market does it. People call this manipulation. They try to break out and they fail. This is the reason we will get here.

You finally will see a trader break down candle by candle exactly what he thinks is going to happen live during New York session.

We are getting ready for the squeeze. The squeeze will be present here.

Look, there you have it.

When I told you I will scale out, it's exactly because when you see this, the next step is aggressive sellers. Yeah.

You, you coded the algorithm.

This is a top 1% trader showcasing his strategy for free.

To give to the audience a little bit of reference, you can either do 15 minutes, three minutes, you can do one hour, five minutes or you can do the most aggressive one. That is what I. The setup that we took before is exactly what I will execute in the World Trading Cup. How I did this performance in the World Trading cup is building profit for the day. Building profit for the day. Building profit for the day. And in directional days I risk for.

Example Fabio Valentino, you've never seen anything like it. It will blow you away.

Make sure you tune in to this episode of Chart Fanatics. Welcome everyone back to Chart Fanatics. The go to channel for all of.

The very best trading strategies and concept.

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Rankings of the Robins Club actually achieving in a 12 month period over 500.

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We're going to go through his exact strategy that he used to be able to achieve those incredible results on the.

World stage is the one and only Fabio Valentina.

Thank you for asking me Ritz. And today we will go deep dive in the model that I used in the World Trading Champion. I made some videos about it but I keep the source for this, this podcast and before starting to explain how the model works we need to explain what's the misconception about market structure in the market. So, so I will just start drawing it and explain what 90% of traders do and why 90% of traders lose money. So let's start with, I think that'll be helpful, the concept of the market structure. That's what usually a lot of traders do. And you can confirm it. This is what usually it's done. Watching a market structure shift or change of character or breakout. There are 100 terms that you can use for it. And what they try to do is they try to go trend following when pattern like this presents and then they can just wait for the retracement to jump in. Just going through, considering we are in a short sentiment here, like using the concept of supply or order block. If you want to be more fancy following the algo mitigation level and continue to go down. Now what I tested in a lot of years of experience is that this pattern usually doesn't work if you don't frame it in the correct concept. And to frame it in the correct concept, you need to start using something that it's necessary, that is the profile. So you need to understand exactly where you are in the market and what's the big picture that you are watching. Because if this pattern is presented when the bell curve of the distribution of the day is like this, you are exactly jumping on a trend to go against.

The lower distribution of the volume. And what this says statistically is that only 30%.

Will go through. The rest will remain in what it's called the fair value area. So you will just keep getting stuck top doubt till the market really decide to take off. And this is the reason a lot of traders that try to embark on a journey of using trend following strategies, they understand really soon that the win rate is not what they were expecting like 70, 80%. When they try to target for example this level from here and they say, okay, I will just have 50%, 60%, we rate one to three. This is not real because.

You are not reading what the market is saying. You are trying to predict the market. Okay. Now the good point about order flow and about volume analysis in general is that you get the knowledge to understand when to stay away. Because if the same pattern is presented in this area, it's a completely different situation. To explain you this, we need to go to amt. AMT is the real nature of the market and is the concept of auction. Market theory.

Yeah.

Market is an auction and it goes from balanced area where all market participants are transactioning efficiently to imbalance. Now market is not usually in imbalance, it's usually imbalance.

Yeah.

So that's the reason why traders that Start, take streak of stop, loss. Because they try to get the long and they get liquidated by. You can call what you want, you can call spring, you can call liquidation, you can call liquidity seeking everything you want, even if it's not what happens behind the curtains. But you try to get the last spring before the move up and you Notice that this 1 to 10 becomes a 1 to 2. Because you take four stop to try to do it.

Yeah.

Now, if you do this simple change and you wait for the market to get to a condition of out of balance, your win rate will jump up by at least 20 to 30%. And this is exactly the building point of the model that I use, why I call it the model and not a strategy. Because the concept of strategy is a group of rules that you need to follow strictly. And how can you follow a group of rules strictly without understanding the narrative? If the market is a dynamic entity, it's like trying to cage an animal that is not made to be in a cage. And it change every day. It adapts. For example, yesterday there was this situation about America bombing Iran. We open with a gap down, really heavy. You cannot expect that the market today will behave as Friday. You will have a different behavior. Now, what it's helping you is understanding how you can use the profile to exactly time your entry and your area. So this is the step one of the model.

And is understanding the location. The location is when you can efficiently trade when you are out of balance. So your model is okay to be traded. You start to see what all the traders are using. So you start to see the market structure and you start to validate which area can be used to jump on trade.

Yeah.

Okay. So now it comes handy to use supply and demand zones and it comes handy to understand inefficiency. Now, inefficiency, if we can talk about it, is misconcepted nowadays because it's used the term fair value gap. Yeah, but what happened really behind the curtains in the concept of inefficiency is when one part is more aggressive than the other. So the market gets really momentum in one direction. And this is, if you think about it, is the best moment to transact. Because the market is telling you this, and this is not my personal opinion or your personal opinion, what the market is telling us, look, I'm out of balance. I'm searching for a new level of balance that will be down. So it can be here, it can be here, it can be here, but I'm telling you that I will go there. Okay? Yeah. At the same time he's telling you that the sellers are more aggressive than buyers because you are getting this kind of concept. And that's when you go to step two. Step two is the concept of validating the level. Because now you have the direction, you have the condition of the market, the market status. And you have three possible take profits that you can frame by watching at the other area. Now it comes handy, a concept called order flow that is not a concept but is like an Alphabet, a new way of reading the market. So 90% of the trader try to understand what is happening inside a candle using multi time frame analysis. Yeah, I think the real inefficiency is the way trader analyze the market because it's like trying to get.

The bullseye blinded. Like maybe one time it will work, two times it will work. But you don't have exact data about the location. So what you can do is that you can use this area that create the breakouts. And let's consider that I make an arrow here and we zoom out what is happening exactly inside here. Okay. So if this is the swing point that break this low, traders will just watch for what is called fair value gap or inefficiency. That is when the candle is not transactional. What you can do is that you can use from point A to point B using profile to watch exactly when there are low volume nodes.

Yes.

And I know this because I saw the other interview that you have made and I really like the model also of Carmine Rosato. I think he's a really good order flow trader and he's doing something really similar to what am I doing? Because low volume node, it's a really good reaction level. So you can use it as a continuation. If we have a low volume node here, the probability that we will go down is really high.

Yeah.

So you start to add the concept of refinement. You have the direction, you have the location, you have the refinement of the location. Now you need the step three.

The step three, it's a little bit more difficult because it's the part where you really need experience and you cannot just automate it and say okay, when it's happening because it's really sensitive to market. What I use is analyzing big orders. So when there is in one specific point, let's say here, a lot of aggression. Okay. And in order flow platform, typically you see bubbles. If you use any platform, you can see bubbles. When there is direction, location and aggression, your ability to predict is 0, but your ability to read is 100. You are exactly. Tuning in in the market that the correct moment and you are not predicting what is going to do, you are waiting. So this is really beneficial because when you see aggression you don't have a huge stop loss. For example, out of balance you don't have a huge stop loss above the high but you can get protected. Exactly above the big sell aggression.

Yeah.

So your risk to reward rate it's really big. But at the same time the probability of your trades is really really big. Also this one, what you are doing, if we can make an example is just swimming on the direction of the flow. Because you are being pulled down by the market aggression and also by all the traders that were long. And when this area breaks will close their position. So you get the catalyst down, you get the location of the aggression of the cell and you get also the target point that can be based. We will see these on chart directly on the previous balance area. Yeah. Because all the market moves. Let's remove this part here. But all the market moves is that is seeking.

Balance. So if you go out of here and the previous balance area was this one where your POC point of control there is previous point where the majority of the volume was located. It's here the probability that when you go this pattern and you enter here, let's say you don't need to break your mind to understand where you can put your target. Maybe I can try one to 30. And this is another error. Traders think that the risk to reward is not influencing with rate. The more you seek to go above the ATR daily, the more the probability will get lower.

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And let's get back to the episode.

So with this model it's really uncommon that the market will snap back inside. Because when you see aggression and out of balance, the market needs to search for new balance. It's like human being when we are in a condition of fear, our heart continue to have tachycardia till we don't get back to calm.

Yeah.

And we say okay, now we are stable. Okay, this is exactly what the market is doing. So the step three is getting a location for aggression so that the trigger of the model is aggression. And that target point, the target point also is really objective. And I notice during this year and also scalping during the World cup champion that we can also get a window during the day where this model works really good. Yeah. Okay, so the best session to use this model, it's 100% New York session specifically for equities, so for NASDAQ and for ES and is not working properly. During the first hour of London session I try to use this model. And during London session you see out of balance, back inside balance, out of balance, back, back inside balance. This is called by traders fake outs. Yeah, and it's usually when the market is not really clear about direction. So one concept That I use to remove this is that I don't trade before New York session. Yeah. I only trade before New York session in the World cup. But with a mean reverting model.

Okay.

So I was doing the opposite. And we can go also to it because it's extremely profitable and it's even easier to implement this one and is the following one.

So let's say that in a balanced market from the statistical perspective, during the London session, usually in indices you have mean reverting behavior. Okay. So it's less common that you will see a trend. Yeah. You will see bouncing and going out. So one other model that I am using is the one that takes opportunity of when the market is deep discount based on the volume distribution at mishnaps back in. Now it's the same concept Ritz the opposite. Now we are seeking for buy. We have a target. Why we are using this target because this target is where the maximum volume volume is transacted. So there is interest like market operators are willing to transact here. What I do in this area is that I don't take the first movement. I wait, I wait for the first breakout. You can use price action for this. Because I get clear market participants of what they want to do. I don't risk that this is only a retracement and then they collapse.

Exactly.

I get a movement that is clear. When I get the first breakout and I'm back inside the balance, this probability is really high. This really high probability. Now to increase even more the probability. I wait for the hand of the big market participants. So I wait for big trades. Yeah. So the common bubble of buy order that they can just say okay, I jump in with them. I don't need to be a wizard. I jump in when the best one are jumping in with big volume. And if I'm wrong, I want to be wrong immediately. Okay.

Yeah.

Because all the additional losing that you get when you are inexperienced trader and say maybe I put the stop loss larger when the market is going against you. Because I will it will snap back. This is really something that will destroy your bank account and your trading account. What you need to do is be wrong immediately. And when you are right, when you see that you get an additional breakout immediately stop to break even.

Yeah.

So after this small movement, you are already is free on the market.

Quite aggressive of your risk management.

I'm aggressive with my risk management because I need to put in this small amount of ticks. 0.25% of my account or 0.5% on the account.

So you say you could do this or take this concept without order flow for example. But of course the order flow just allows you to have more confirmation align more with the larger orders.

It's working also for price action. But it's like something that when you see it, you cannot unsee it. So when you are trading your mind as an order flow trader says okay, price action is nice, but let's see what is happening in the level you want to see it. And then I think it's not convenient nowadays to not use order flow for one simple reason. We are edge and edge seekers as traders. Every 5% more win rate brings us more money at the end of the month. Every 1 hour, 2 hour, 3r more at the end of the month is more money for us. So why not using all the information available. I've been in trading floor, I seen how they trade and institutional trader considering that 90% is algo trading nowadays. But the discretionary trader for alternative markets, they still use order flow. They use order flow because they want to see what they are doing. Maybe they are more long term because they work with huge amount of capital. So they prefer to use volume profile. But for short term, after 10 years of trading, I never seen something better than than order flow. So still nowadays the model is not getting changed. The only change that I've made is during high compression period that we have seen in 20, 23 and 24. The the month that you are going through. Summer, like end of March. Yeah, May, June, you see the market is getting a little bit compressed and August like NASDAQ movement are really choppy. So what you can do is just say to create specific condition where you will not transact. So this model, it's okay for London session, is not okay for New York session, but it's perfect for the summer. I'm giving you a model that it's perfect for the months that we are going in. Because this is the behavior maybe with Iran and America and Israel, it will not be the summer to do this model could change.

But.

But yes, it's working properly to your.

Point in terms of order flow wise, regardless of your conditions, that understanding of order flow remains. Right. So in terms of the principles that you're using when using order flow and understanding that information and deciphering that information, regardless of the conditions, whether we're compressed or whether we're getting a lot of volatility and movement, though the lessons and principles you take from order flow remains universal. So outside of because with price action and purely price action, the Problem is one, you're guessing. You're trying to guess where stops are. You're trying to guess where the big players are because you can't see it. But equally when conditions change, the same concepts aren't universal. Now you have to change and be able to adapt. While with the order flow, you still have to adapt, you still have to change in terms of maybe your risk management, your trade management, but the order flow itself, those orders are still orders. Those stop losses, those participants are still going to be the same. But just a quick question for yourself, you weren't, were you always an order flow trader or is it something you picked up?

No, I was a first action trader but I'm really open minded. So if someone comes to me and say, Fabio, you can improve your risk to reward from here to here using option flow. Yeah, I'm really open to it. Like I think that a trader needs to be the most open minded person because if a new tools, for example, if new data like MBO orders can improve your model, you shouldn't be, you shouldn't put your ego here and say no, my model is the best one. If it's improving your profit factor and Sharpe ratio, just use it. And connecting to your point, I went to order flow also. Also because the price action, it's harder to replicate for students because let's say that we have 100 people watching this, okay? And we say, okay, use a break of structure in favor of the trend for someone, a break of structure is this for someone can be external break of structure for someone, they take the big swing and this is the break of structure, okay? If I say to you, look.

Drop for the full day. The profile, the profile is this one. This is the level where you are out of balance. It cannot be this. It cannot be this. It cannot be this. If I say to you Ritz, when you go here, just put a filter of 30 contracts on NASDAQ on the one minute. You cannot think it's here because you will see the ball. So it's really objective. Now there is a skill in reading of course, market sentiment, market change. But when I explain you something, something that you can go home, test it and you will see exactly what I'm seeing. With price action. I think the, the subjective analysis is really heavy. Especially if you start to input multi time frame.

So definitely, yeah.

From daily to H4 to H1 to 15 minutes, 3 minutes, 1 minutes. What's the probability that the trade that you frame is the same that the trade that your student will frame really low.

That's what I was going to say. So when it comes to say, teaching, for example, when there is no order flow, that subjectiveness becomes quite a difficulty because everyone has a different perception. As you said, as you, you know, there's a really good example of showing that. But then when you have order flow, regardless of that, the time frame potentially, and you know where you're looking, that the areas of the charts are all going to be the same, everyone's going to see the same thing, and those numbers are going to be reflected exactly the same across the board to every single person. While, you know, even the subjectiveness of say just candlesticks, like a large red candle to one person might just be another candle, while to another person they'll be like, oh my goodness, the market is completely falling off a cliff when.

They explain the model. When you see a big cand, how much it's a big candle, how much atr you include. So there is a lot of subjectivity. And also let's consider that.

We have three level of analysis. We have lagging.

We have real time and we are leading.

Lagging are indicators. So if you get macd, if you get stochastic, if you get rsi, this is created as.

A derivative of price, so you get macd. That is always going after price, never anticipating price is real time. So you are watching what is happening as an effect in real time. But with volume, you are watching the narrative before the price created. I give you an example of something that I never explained, okay. And this is something that really helped me to see the develop the developing pressure to be able to put at breakeven sooner than other people. Okay, so let's say that we are here, we have a long bias, we are out of balance and we have the previous day point of control. Okay, so with price action, when can we put at breakeven? When we break this level.

Yeah.

You agree with me? Yes. Because we have a level of protection that we can put here. And we say, okay, it will retest.

And go, yeah, we shouldn't break that low volume.

We can use one tool. This is called cvd, that is cumulative volume delta. What cumulative volume delta is giving you is a benchmark for pressure of volume. So you are out of balance. So the probability you will find a new point of balance is I with cumulative volume delta. You see, this is the price. Maybe you see the cumulative volume delta doing this. When you are here, the cumulative volume delta is doing this. What does it mean? That aggressive buyers are really pushing on the gas and there is A lot of interest because as the price goes up, you don't see sellers aggressive, but you see that buyers are willing to buy at higher price. And if we are at an auction and there is a limited piece of Mustang from 1969, okay. And the base auction is 1 million and you see buyers starting 1.2, 1.4, 1.6, it means that the price.

Is probably going up because they are interested in the piece. So what you can do when you see that cumulative volume delta is pushing up and you see this leg already building and you can already put to break even. Yeah. Because you know that as the smallest retracement, aggressive buyers will continue to push up and you are protected.

Yeah.

This is something that you can do only with leading indicators you cannot do. Before of course I didn't talk about global macro, but also global macro. It's a leading indicator or on chain analysis for crypto, but for intraday and scalping like order flow is the benchmark.

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I love that example, to be fair, because if you really think about an auction, that's probably the closest that the everyday person might have some sort of insight into or at least know and understand how they operate as a, as a usual auction. So in this case the car or house, for example, you'll see the same thing if, let's say, even when there are buyers you want to buy, but let's say if the auction price is starting too high, they don't, they don't really like where it's starting at. You'll see actually, the auction begins, anyone at a million. No one answers, no one says anything. So then the auctioneer or whoever's like running the auction will bring the price down until there's some interest. And then you never know. Like it might seem like, oh, no one wants this car, no one wants this vehicle. In this case, obviously no one wants to participate or place any orders in this market. But then once it hits the level that people are interested at, let's say if it's that car example, again, let's say we started at a million, but no one's interested. Bring it down to 800,000. Now suddenly someone's interested, one person's interested. Okay, we bid it up. But now people who were there for that particular vehicle. Yes. And then you'll suddenly see how, yeah, we started at a million and no one was interested, but suddenly we're blasting up to 1.25 million and there's still orders and still more bids. And therefore that velocity and that amount of demand.

The moment you go to the market price, because the market price is 2.1 million, you start to see at 1.9 million of auction market participants saying, okay, let's go on increment of 50,000, not 200,000. So the market gets lower and you build new balance. And then the point of control is the seller that close it. Yes, usually the auction. So this is how really the market works. And this is what I use daily to frame my entry. And then what's good about order flow is that it's really.

You can adapt it to every market condition. For example, if you have a model with price action that is working really good, you don't need to abandon your model. Just see if you can get better position and remove the losing trades using this concept. So it's not something that you will not start from scratch. Yeah, Just expand the level of knowledge you have from candlestick charts, like you.

Said earlier as a trader and a pure trader at that. And who's someone who's focused on trading 100%. That's your goal is to how do you build more edge? How do you squeeze more edge out of the same knowledge, playbook or strategy that you're using? Because that's really what you do at that point, you're not jumping, okay, I've got this strategy, but I want to find a better one. That's not how the mindset is.

Right.

And then if you come across a really good playbook and edge and strategy, you always can start to add that. But your focus point is, how do I make this playbook the best it can be? How can I be the best trader possible? And in this case, you might have a profitable price action model, but your goal then is, okay, how do I squeeze more out of it?

Right.

So in terms of using order flow, if you're not using that already, that would definitely help you to squeeze more out of it now. Not. I'm sure there might be some people who try and learn order flow and go, this is a bit more complex for me and therefore, you know, for that particular individual it might not be as helpful, for example, But I would say it's probably a slimmer amount of people. Right.

But the worst thing you can do is just not even try because you already write it. It's like people who need to learn fundamentals. Right. In macro they don't because they are complex and you know, the price actions.

Are not much to start. Yeah.

But in reality, when you look at.

Even just this year. But Covid was a great example of it for as a lot of traders came into the markets. But even just this year, for example, is a great example.

Last year, yes, we had quite a.

Bull market, but there wasn't really a crazy amount of fundamentals behind, you know, in terms of like changes and volatility changes and market changes. While this year where we're just coming into the woods the end of June and literally we've seen highs, lows, we've seen the markets completely shift month after month, week after week, and it's probably not going to change. And we call this a Trump market. But again, if you don't know macro, it's so easy for you to sit there and go the markets are crazy. I can't understand what's going on versus the people who do have an understanding. And I won't even class it as like a deep, deep, deep understanding. Some people you just have a basic knowledge allows them to have more clarity and calmness. Which as a trader as we know is extremely important. One thing we'll do so from here. Where should we go from here. Should we. Should we recap the two models quickly? Do we recover two right.

To go on one point before that is called edge decay. Yeah. Let's do it before going to recap the model.

Let's do it.

The concept of edge decay is when your model lose edge. Okay. And this is something I notice a lot with price action. So for example, before I was using supply and demand in trend following. And when the volatility change, for example you are creating one rule that you have moving average long. And we are adding to the trend when you get here. Okay. Volatility change. So the the length of this wing, if it goes from here to here, you already take a lot of stop loss. Not because you are wrong, the direction is right. But the market will just swing higher. And I think discretionary trader notice it.

Yeah.

So this is edge decay. And it's your lose of edge in the change of market condition. It's what's also Jim Simmons was talking about with his Renaissance fund. And with or the flow. What is interesting is that you cannot actually have an edge decay because what you are watching is the true nature of the market. So you are not framing the market in something that is close rule from A to B. But you are understanding what's happening. And I will give you an example of something that improved my model by 4 or 5 points percent in we rate that It's a lot. If you are a scalper and is the following one before. If you are like close in a range, you are trading price action and you are trading continuation with Bricker test model is really common. Okay. So you wait for this. Then you wait for the week down and on the on on the test you go long. Yeah. When if you start to do one simple exercise and you start to only use order flow to zoom out when this is happening. Like you you take one specific part. So you cannot say that order flow is complex. You take the same candle just you make an exercise watch cumulative volume delta here. And orders you can use also footprint for this, if you see that at this level there is a lot of aggression and the cumulative volume delta is doing here, this, it means that this movement is not supported and the probability that you will go down, it's here and it's something that is telling you before the price bring you to stop. So you can just decide not to jump in. And this is a com. A concept that I want to cover because it's something that I went through when the price action model was not working properly during the 2019 and I had to step up the game. And I was thinking, oh no, I need to study from zero and I need to implement something that will cancel and erase all the learning curve that I had with Price Action. But it's not like this. Just you will start from where you are before just understanding what's happening behind the market. Of course it's easier to think that the market is dominated by some black entity behind the table because understanding the mechanic is difficult. But I can guarantee you that you will improve as a trader. And so we go now on the summary of the two models.

Yeah.

And we start with the trend model.

So this model, it's a trend following model. And we will go before on the timing.

That is New York session. Okay. So we want the biggest amount of volatility to implement this model in live market condition. And I don't advise to keep the trades for the night. So this is a model that gets closed as soon as the market close. You don't bring overnight the trades because you also need more margin for futures. It's not convenient at all. Just if you are in profit or if you are in loss, cut the position and tomorrow it's another day for this one. So this is the timing. Then when we go on the step one, the first step is understanding market state.

We can only have two market state. We can have a balanced market.

Price action going here and we can have an imbalance market.

Okay. With this model we want to transact here. We are not interested in this market condition. So also for the gamblers, you have one rule that keeps you out of the market. And this is really important because when I start scalping with price action, every movement was okay for me. Like every small impulse. And then you say, okay, I took three stop for the day, I'm out. And then the big moves, yeah arrives. So this is the lock where you cannot enter if you don't have exactly what the market needs to tell you. Yeah, this is the market state and what we frame as the step one. Then we need the location.

The location is exactly.

Your swing point. This is one. Okay. That you need to analyze deeply because you need to understand if you want to jump in here, if you want to jump in here or just if you want to jump on the train sometimes from the lowest point because momentum is so high that you can just say okay, I jump here, but I cover myself here. So it's still a good risk to reward rate. What you use to do this, you use profile. Okay, Use profile. And what you search is low volume node. So where the mark? Let's make try to draw the profile. Okay. Say that this is the profile for this wing point.

What we can see here is that this is the low volume node. Not the best drawing, but I think it's understandable that we're going to see on the charts. Right. The point where the lowest volume get transacted. What you can do here is.

Do this. Okay. So what I do usually is I don't put a limit order. Okay. I put an alert a little bit below. Okay. Because when it arrives there, I want to see big trades, big orders. Okay. So as we were seeing before we started from the timing, we went through the market state, we went through the location. Go to the step three. That is execution or trigger. What you want to see is aggression. If you are seller, you want a big red ball. Okay. When you see a big red bull, you can jump in and your stop loss will go here. And your target will be the previous balance area. Yeah. So if we are here, the previous balance area. It's here. Let's see the pocket. This is our target. And we are going to take out not half the position and let it run. We are going to take out the full position because the probability is that the market will reverse from it 70% of the time. So we are. It's just not worth to keep the position for only 30% probability more. Better that we take all that we can in this case. Now let's go to the Model 2 and the Model 2 is.

Mean reverting.

So the Model 2 is using the market state. That is the opposite.

Yeah.

So is using consolidation. Market state is consolidation and is when the profile.

Is protecting from breaking here and breaking here. Okay. So you get from here to here to here to here. What we are trying to take is the out of balance condition that get back inside balance. And as I told you, we are not trying to take the first swing because it's risky. We are getting the second swing. So when we have the first breakout, we are just waiting for the retracement. It's the same concept as before. Now the location is this wing. Yeah. You frame the location, you wait for the retracement. So let's consider that this is this wing. Same stuff. Low volume node.

Aggression seller. Consider that we are here. Maybe where we go, we don't go here. This is an error that everyone is doing. The probability is not you go here, you go to the.

Where the bulk of the auctions taking.

Place, where the probability that you will go to balance is really high. And if you are wrong, you want to be wrong immediately. If you have big sell orders here, immediately here it's your stop loss. A small trick. For the scalpers, aggressive scalpers. There is a way to avoid slippage or at least minimize slippage. Put the stop loss not above the high, because above the eye there are a lot of orders. And what you see is that market will accelerate. Example when you take previous daily high, previous daily low, previous weekly high, previous, you see that the market, even if it's a failed auction, now it's going down. It accelerate. So you lose an additional amount of tick that you can protect. How you can protect them? Just put your stop loss one or two ticks below the high.

Okay.

So you are taken out before everyone.

That is full acceleration takes place.

And it's worth it. I tested it and it's worth it because sometimes you get five tick, six tick of Andy's a lot.

Because the overall chances of price getting to one or two ticks below that high and then not go not.

It's almost zero. No, it's not zero. Sometimes it happens and you just want to cut your ends. But on the long term, like statistically wise, it's worth it. Yeah.

Because in this case, for example, just to recap, so this recap wise, timing wise, you're looking at potentially London. Right. And then in your consolidation periods, such as normally your summer months. Right? Yes, just as an example. But in terms of recapping the thesis, it's the fact that yes, you know, we're in a range and yes, you could target here because price has shown that yes, we're going from high down to low. But the highest probability is that auction, auction area where the bulk of the orders and transactions are taking place versus okay, yes, we could get here, but there are chances that we could get to there and rebound back up to that auction area again or rebound back up to the high that there's too many variables trying to target here or especially lower versus the highest probable and that you Know it's not guaranteed. Nothing's guaranteed. But the chances are way more in your favor, especially considering the information you're taking on board. Because again, you're not just entering from the first spike out of the range. You're going to wait for your confirmation and then look to execute.

Exactly. Exactly. And then consider that there are some days that they are really blessed days where you have this model.

Yep.

Then the market breaks the law, you activate the second model for New York and you take two amazing target and you are done for the week.

So yes, these are the two model. Now the tricky part is correctly identifying the consolidation because you can make it as simple as possible and say this is one day. So I use the profile of the previous day. Yeah. Okay. So it's easy. You don't need to have headache about it. You just wait for the. Okay. There is a more advanced model where you have more execution, where you get the ability to identify the consolidation phase. Okay. You just take an order flow platform and you see the compressed candles and you just plot the profile on there. This is what we were going to do because it needs a little bit more skill. I will explain. You pull out the profile and I will show you something really interesting that not TradingView but some order flow platform are willing to give you. Also the delta of the ransacked volume before. So you can see for each level who is dominating the market. This is really useful because if you see here that you are going up and is dominated by buyers, it's not the best condition to get the buy trades because the probability that you will do this, it's really high.

Yeah.

At the same time, if in this area you see a huge delta cell when you break out, it's your birthday. Yeah. You just go for it.

Should we go over the quickly, the pros and cons and then we'll pull out the charts.

Let's take a break for a minute there guys because I want to tell you about our incredible sponsor, Trade Zella. TradeZella is the number one trading tool in the entire trading industry. TradeZella allows you to become a more profitable trader, allows you to make immense progress as a trader, no matter if you're a beginner or an advanced level trader. Because it makes journaling easy. It makes journaling something that is fun and enjoyable and something that is interactive. So no matter if you're a crypto trader, no matter if you're a futures trader, no matter if you're a forex trader. No what matter, no matter if you're a Stock trader. All you have to do is select your broker, your platform of choice, and connect it to Tradezella and it will automatically sync your trades and pull all of that data onto the dashboard. Making journaling and finding your edge and adapting your edge so easy. In collaboration with Tradezella and chart fanatics specifically, we are actually getting the playbooks from the episode episodes that we're filming with these incredible verified traders and adding them as playbooks onto Tradezilla. So you can actually go on there and see the rule sets already predefined. So make sure you check that out as well. Now you can actually get 10 off your monthly subscription using CF10 on TradeZella right now. But more importantly, I would say CF20 for 20 off your yearly subscription with Tradezella. The links for Tradezella are in the description below, so make sure you go check them out. UCF 20, get 20% off your yearly subscription. Become a better trader today.

Now let's get back to the episode.

Yes. So let's go on the pros and cons. The cons is that if you use the second model, compression days are killing you because sometimes, especially if you don't work on the daily profile, but you work on the.

Short term profile that you can trace by yourself, the consolidation is killing your win rate because maybe you take five small stop loss. Yeah, five small stop losses, maybe a lose a loss on $5,000. Then you take one, take profit and is like 15, 20,000. But at the same time psychologically the win rate gets lower. Yeah. And if you see a lot of red in your account, even if at the end of the week you are still profitable, it's heavy for beginners.

It's a heavy.

So one bad concept is consolidation that directly affect win rate for the model. And this is the reason I created a second model. Because when I lose with one, I make profit with the other one. So it's like balancing the equity curve, giving you more execution, but the drawdown gets lower. So it's worth it. This is the first cons. The second one reads stress. We need to be honest with it.

Yeah.

When your trades gets to the level, not in a Prof. Firm, but in a real account where the single position is worth the salary that you are taking for example, 10 years ago. So you are risking 2,000, 3,000, 4,000, 5,000 per position and in two minutes, three minutes, you can lose it. Of course at the end of the month it's profitable, but on the short term, it's heavy on the mindset.

Yeah.

Specifically if you go through the moment and there will be moments where you take streak of stop loss. Like in the World Cup I show transparently, transparently the trades I was taking. And one day I received a lot of insult from the people on Instagram because I've been transparent of one day taking eight stop losses like small stop loss like five ticks. But a lot of stop loss because it was a day that.

And you risk sometimes 0.20, 0.2, 0.3.

So it's like nine stop loss is 1.8%, 2%. It's not a big amount. You can deal with it. But when you talk to people and you say look, I took nine stop loss. You say learn to trade. Yeah. So. So. So they. They just think that a profitable trader is a trader that having a huge amount of win rate. They don't consider that maybe the stop loss are incredibly smaller than gains. Yeah. So the stress part and the third cons is that time commitment like to execute this model, you cannot do it as an hobby, you cannot do it as a side hustle. You need to be in on the screen from the starting of the newer session to the end. Because the position not only need to be executed. Yeah, it's set. And don't forget it's set. And check is something like this. Because you need to trail your stop. You need to.

This is a model for real traders.

This is a model if you want that trading gets your full time income.

Yeah.

Okay. Now on the London session I managed. I manage companies with my business partner. But in the new year session, three or four hours I do this and it's necessary. You cannot just get out. You can just decide that after a certain time you don't open trades so you can enjoy dinner. That's of course can be. Can be something good on the pros. The first one is.

Number of trades. Why this is good? Because drawdown gets covered really fast. If you have a big profit factor and sharp ratio. So you can take nine stop loss for the day. But by the end of the week I was again in profit. I was hiding watermark. So I was creating new high on the equity equity curve. And also a big number of trades creates something interesting for hedge fund that wants to give you capital. Because a model that in 12 months does 2,400 execution is more respected than a long term model that in 12 months have 30 trades.

Yeah.

Because the data sample wise this model is more valuable.

Interesting.

Is giving you a lot of room of improvement and is giving you a lot of data Analysis that you can input and you understand really fast if your model is not working properly in certain market condition. Because for example, I have a benchmark that is the maximum amount of stop loss I've taken that is 11 stop loss. Okay. It's a nambling experience. But you know that the market can stay in compression for one full week. You know that every day it's a fake breakout for one week. I saw the last videos of Carmen Rosato. He was like taking a huge amount of stop loss like for three weeks, but he's still in profit for the month. Yes, that's the good part about scalper. The number of execution. And it's really easy to go back in profit. The second good part about trading with this model is that you don't need headache.

Why you don't need headache because the prediction part is not there. You are just paid to read what the market is telling you. So I don't need to start to say considering the angle of gan, maybe the price will skyrocket to this price because this let. No, just this is the market state, this is the location, this is the aggression. This is my trades. And another good part, maybe this is the best part. I should have put this that you cannot do revenge trading because if you don't have the condition to trade when you trade large amount of size, you just don't feel confident to execute. If there are not the condition of aggression, just it's not worth it to do it. So the third part is just there is no headache in deciding and no revenge trading in executing something that is not there. Yeah. You know, with projection, I don't know if you ever experience it, but sometimes you see something that is not there just because you want to trade. So you trade the setup.

Well, you can have a bias and then if let's say one time frame isn't giving you that bias, you can just filter through until you find one. Like I'll ten time frames, let's say eight of them along. But you want to be sure you'll just go to the one that says short. Yeah, yeah, yeah.

This is something that I also did it like. Our ego is bringing us to the condition that if we say in our mind that the bias for the day long and the news are long, we will just take every demand here because we think every demand that is getting break. It's a fake.

Even down here, even liquidity, this wing.

Doesn'T get stick out. And of course this is a liquidation. So you also try the reverse. And then when you get Destroyed.

That's normally the last. Last resort. Last resort Y But another pro is that it's a high risk. It can be a high risk to reward.

It can huge risk to reward. When it's not common. I need to be honest. But when NASDAQ is pushing, is pushing hay and when you are in from the breakout of the level and you are because you need to consider that our target is the poc, if you are here, there is no POC because you are creating value up. So you just decide to trail for the day.

Trail. Yeah.

Okay. Sometimes you get some one to 30. One to 40 is not common, but it can happen.

But even high risk rewarded like 1 to 4, 1 to 5, that's a.

Common 1 to 1 to 2.5 is the minimum.

Yeah.

1 to 5, it's common.

Yeah.

1 to 10, 20 is not common. It only when I do 1 to 10, 1 to 20 it means that you see on the NASDAQ 2%, 3% for the day.

Yeah.

So it means that I really follow the market properly. But I cannot do 1 to 10 if the market is doing 0.25 for the day. Of course, like I'm in tune with it.

Like this is not like you focus on risk reward. It's just part of the model. You're focused on understanding what's going on and then reacting and following your model accordingly.

Yeah. When your model and when your primary focus gets to protection of capital risk management, you increase the profit.

Definitely.

Like when you put your focus on something that you think it's not directly related is when you make the most amount of profit.

Well now let's go into well, the charts, I guess the actual trade examples. Yeah.

So as we've established, this is truly.

A strategy and playbook for real traders. Traders who really want to not only.

Trade, but understand the markets at a deep level.

So now we're actually going to go over trade examples on the charts of those same playbooks. And what do we have in front of us here?

So this is a order flow platform, is a deep chart. And what we have here is volume profile, distribution profile of specific consolidation area. So what I was explaining to you before is that you can make it stupid simple putting just daily profile. You can do this also from TradingView. Maybe the volume will not be as precise as this or you can just do it identifying the most interesting compression area. As you can see here, they are clearly visible where the market didn't transacted higher or lower. It just stayed in compression. I use every day this area and what I wanted to show you before is exactly this. You see here is the volume. Okay, this is the volume. This is how much volume is transacted per price level. This blue line is the value area. So every time you see the model in consolidation, when it gets back, get back in target.

Get back in target up. Get back in target down. Get back in target. This one will be stop loss. But you have the second model. You have the execution model of this. In this consolidation. We need also to be honest that you don't identify it immediately. You need. You can identify maybe it from here you can take these two trades. This one is really uncommon because you start to see the real compression. Yeah, it's too early. Exactly. Now what is interesting is that you can frame also the delta. What is the delta? The major amount of volume getting transacted from one side on one place level. The aggression. And if you see here, look how much is big. The delta is exactly at the level where they accumulate the last time and created this extreme breakout. Okay, this one here. I will also explain you later why the news catalyst is something where a lot of people think that the market is seeking liquidity. But at the moment this movement is made because market maker go out of the market. So the volatility gets higher because you have less limit orders. And in this case the market explode up to create a new level of balance. So in this case we have reversion model. Reversion model, reversion model, reversion model. And stop here, probably aggressive model here, breakout. And we will go deep dive in the lower time frame. Because now we are in five minutes. Then we will drop down to one minute. This model can be used in every time frame, like to give to the audience a little bit of reference. You can either do 15 minutes, three minutes, you can do one hour, five minutes, or you can do the most aggressive one. That is what they do. Five minutes. One minute. Okay, so five minutes is to watch the breakout candle. Okay, this one, I don't go deep dive inside it because it's impossible to execute. You see, it went out of balance. No retracement, low volatility, low liquidity. So it's impossible to take. Then we will go to this one. That is the 23 is this morning.

Okay.

Okay. This morning we will see exactly how the model play out perfectly on the trend following side. So I will show you how also the model behaves in London session. Even if I only use this in New York session. The model really works as also reversion model in London and New York.

Yeah.

I want to show you the entity of the momentum to explain you why I do New York. This is New York. This is. You see how much is compressed more retracement. This, when you take it, it just explodes. Yeah. And this is what I was trying to explain you before as the flow. Getting in tune with the flow. So what we do now that our area are clear, we can go to one minute time frame.

And we will start with the first one. Okay. What we have here is the previous area. This is the value area. I. This is the value area low. This is the poc. Okay. So we are clearly out of balance from this movement. You can either be aggressive or just say I want to clear out also the high. Yeah. So I just want that there is no obstacles in my explosion. Higher. This is something that I usually do. I don't transact only when you break out. I wait because it can be the reversion model here, you know, Then what we do, this is.

The magic.

We activate the orders that are getting filter for the amount of aggression. Yeah. Okay. So my filter usually is around 20 to 30. Okay. In this case, I think it's pretty visible. And this is the best example you can have. Look how much is balance. Look what happens when momentum is building. So what I was saying to you, even before the breakout, if you know how this stuff works, can you understand that something it's happening here. You are going from small orders, balance to someone buying aggressively and continuation aggressively. Yeah. Also look at the amount of big orders that you have in bullish momentum and in bearish momentum. So you can clearly understand if you are following the flow or no. So the trades here is like I was saying before, either the momentum continuation trades that you get framing the level with a huge presence of buy aggression. And this is another model that I also show on YouTube that is just not. Because this stuff happens in one minute. So every candle is one minute. You can either be fast and use only big orders or just as I was saying before, plot the profile from the beginning to the end of the impulse and say, look, let's zoom out in here. What we have, we have a lack of volume here. Yeah. So there is a huge area that we can use as a low volume node. Okay. So when you have the retracement and you get close to the area, you can decide to take this as an aggression or.

I will take this one as an aggression. Okay. Maybe you enter here, you have the mitigation of the level and then you have just continuation now the more you wait to enter, the more it gets risky. Yeah. Because if you enter here, you are getting to a point where sellers can say it's too expensive. The price I went out of balance. But you want to be in fast and close fast. Yes. Okay. So from here you can just identify from when the aggression is still bullish. I will start to be a little bit afraid here. I will start to say, look, the market is compressing again. The sellers are starting to fight back this huge momentum.

Yeah.

So maybe I can put my stop loss in profit below this low. Then what happens that the market against. You don't need to be a wizard. The market give you clues. Because this breakout you see, it's participated by huge buyers.

The sellers try to get control back here. But what the market print a week. So it means that they cannot control the movement. And I would completely take out the position where I see that. Because big sellers, no follow up. Small sellers, big sellers, huge follow up. On this candle, you can go out, you can go out on stop loss in profit or you can go out when you reach your risk to reward. Okay.

Because with this as an example, just to highlight.

Yes.

So as you say, sellers no follow through, but consolidation.

Yes.

We continue, we break out. We see the buyers again.

Sellers from the low.

Yeah. Wick, but no follow through.

Exactly.

But could you say that these sellers are entering. They may be not getting stopped out. They're still in the market. So then when you finally see the sellers and then the follow through, now you know you. You use this buildup of sellers previously in included as well.

What, what I use excite is exactly what you see. What I use is volume spread analysis. That is the relationship between price and volume. So if I see like you were saying here, sellers. Okay. Yeah. Trying to push the market down, but they are punching a wall.

Yeah.

They are not going through. So what they are doing, they can either stay still inside the position. If this movement stop them out. Yeah. The market will accelerate. Of course. Okay. So what I see is that this aggression is the first one in all. This movement that print this huge candle.

Yeah.

Why Staying in a movement that is saying we are getting the control is like getting inside the world and being by the side of the weak parties. Like doesn't make sense. And from here you can see that participation is mainly by the sellers. I want to show you something. I want to clear a little bit and get back. Remember how the volume is inside this area. Okay. Let's remove for one second the big trades and let's Go here.

You agree that this is a compression area? Yes. Okay, let's print it.

You see that the market is not accepting below the value area. Because what happens is that here is transaction incorrectly. But every time they go deep discount buyers enter aggressively and get back the the position here. This is exactly what's happening. Let's go on the today price action.

And so we, we saw one New York and we watch one London session. And this is not a normal London session. This is a London session. This is after the bombing of Iran. So the volatility, it's even higher than the usual London session. Because the market needs to rebalance this gap. Same situation Ritz. So if I tell you, forget about everything, it's here. Just tell me in which area there is the major amount of delta aggression from the buyers. In which area you can see.

Would it be the buy as you say?

Yes. Would it be exactly this one?

And if you see again, see I'm happening.

If you see, this is exactly how you can identify when it's an accumulation and where it's a distribution. Yeah, this is where all the traders are struggling. Like Wyckoff accumulation, distribution. But how can I identify objectively what's happening? If you see from this level, aggression of buyers. Catalyst. Yeah, let's go down to the one minute. We are already in one minute. Perfect. We activate the big trades again, same model. What we see buyers aggressive. Catalyst. Catalyst. Catalyst. Catalyst. Again you see what sellers are doing? They are trying to push the market up, down. But what's happening, they're getting fucking humiliated by buyers. So if you get the profile as before, from the starting of this wing to the end of this wing, what you can see, you can see that volume is equally distributed here. And you start to have a low volume from here. So in this case, to follow the exact model, you will be unfilled in this position. Okay, let's go education wise on and see what's happening. And reading here.

What you can do considering that you are still in the same area. You see that from here to here they create a new dealing range, new area. So you can do just the same from here to here. And you can go deep dive inside this location. Yeah, look, where is the value area low. And look, what is the low volume node? You see this lack of volume here?

Yes.

So you have the low volume node conceding with the value area. Low conceding with this is Fremont bias. It's fucking Fremont. You wait for this candle. You put the stop loss here. You target either. Because even if you want to target.

Let's see here. Okay. You are risking per contract $160 in the worst case scenario. If you want to be out really fast, you are risking 160 to make 500. Yeah. Okay. So there is to reward. It's more than one to three in this case. But this is the excursion the market gives you. So you. You see how the risk to reward can get really huge if you get in tune in the market. Yes. And the addition to the position can be done every time that the markets create a new eye. This failed auction, it doesn't break out, but then it break out here. Okay.

To the.

Yeah. Again look, zero volume here. Like from the profile.

Punching the wall. I will not get this trade because I don't have aggression. So it's not as safe as this one. Yeah, but again the bias is completely fine. And this is the both of the model we saw the reversion model and the trend following model. And the first time that I find out this myself was a haha moment. Yes. Because I just went to order fluency. So I can see before it happens how the volume is developing. And also small exercise when the market gets taken back in control by sellers. All this small volume then huge aggression from sellers. But look also where the market reacts when it comes back. What is doing now? This is actual price action. We are not charting the past. Yeah, sellers in control where they will find the first problem when they get back to these aggressive buyers. Otherwise they will continue to push the market down. In this case. And when you see this case, it can be a punch on the wall because sellers try to push it down. But buyers protect the level. And if you see it closely, what is developing is a trend following condition. Because we are going after all this balance. We are going out of balance. This is the first breakout and they can go back to the previous point of control. So they have a long room to go here. And you will notice, I don't know if it will happen live that if this level get tapped back it accelerate because sellers are adding to their position. For now it is out of balance print and is going to rebalance to the POC because it didn't it was not a successful breakout. Yes, that's the reason I say always trend following or reversal. Wait for the second drive. Don't take the first drive because you can get tapping in a fake out. Yeah.

That'S it. It's not difficult. I know it's a lot of information for the audience for the first time.

But I think it's a lot cleaner than some of the order flow breakdowns I've seen before.

They just make it hard to not let people understand.

I mean different platforms as well can make like. So in this case with the what we would call the bubbles for example. But in terms of execution as large orders. So if you filtered it so that it only shows specific size of orders.

Exactly. Specific size.

And then you can take it on and off as well.

You want to filter out the noise. You want to see what actual big orders are doing. Is the same concept as commitment of traders for long term.

Yes. Yeah.

You are just watching the the participants that matter. If you move one contract in many, I'm not interested in you. You can do what the fuck you want. But if someone is adding 100 contract on NASDAQ on one minute, it's interesting like the momentum in terms of price.

Getting to this point, this high that we were talking about here. Because as we were talking about potential trades from down here.

Yes.

What Is there anything to the left as to why price is reacting at this area? I think there's a high to the left that we were originally looking at.

You want to see where we are going?

Is there anything of significance in this area? That's what would lead you.

We don't need to guess. Okay. So let's remove this part. So we don't know exactly where it was. Let's print it and let's go down here. Okay. Now let's clean all the noise.

Let's go down here. Okay. As you can see in all this area, the value array is this one. So I will make white the value area.

So this is when the market considering all the profile, the comprehensive profile also of the gap is when it's getting expensive for market participants. Okay. But if we get deeper, we notice that the biggest peak of sellers. You see this one. Okay. So this level can be something.

Interesting from sellers perspective wise.

The market reacted from this value area is distributing and Enzo was saying to you probably is going back to the POC that is this level and it's exactly overlapping with the big volume trades. Yes. So.

The probability of a follow up short now it's higher in this case even if they get before back to the poc.

Yeah.

And then redistribute distribute back down. But I want to show you also here from this profile. Was it understandable that this was the reaction level from the delta that is developing?

Yeah.

Yes. Because this, this supply is the real whale way of plotting supply. You are just watching volume wise when there is the most amount of executed trades, not limit, but executed trades. This means that the auction get too much expensive. Yeah. They want to sell off in this case and they sell off till here. Then what happened here exactly is that the price get too low to sell because it's getting cheap again to buy also for buyers, you know. So from this perspective, we have this buyers trying to aggressive, no follow up. Sellers, no follow up. So we are getting inside the decision range. The first one that will get breakout, you will see a catalyst in that direction. And probably the first level is this one.

Because even in this case, for example, if this was to break the high, even though we might not be looking to trade this, but if we were looking to make a prediction, would we then break the high and then look to go to the high of the value area potentially, or even the. The previous.

I will say the poc. POC first, like distribute against the poc. And then if you need to refine an area where you can probably see a reaction, I will say this supply here, like you were saying, not because it's the best level to react, because the best level to react is the value area high.

Yeah.

But because this delta here, it's really reliable on how much aggression is it giving.

Hey, guys.

So we've had obviously the biggest nightmare.

You can imagine on chart fanatics. As you saw there, we were middle of screen recording, storage issue. Screen recording cut. We cut. No problem. We came back, we pressed screen record. But something happened. However, what we're going to do to make up for it. One, we're going to break down exactly what happened step by step after the fact. No problem. But we're going to actually wait until New York open and then we're going to do some live price reading. Then, you know, at an actual time where Fabio does trade. And we'll be looking at specific things as well. So we're excited for that.

Hey, guys, we're back.

I promised you New York session. We are 30 minutes before. Just under 30 minutes before the session open. We can recap exactly what happened since we left as well. And super excited for this first time ever. I don't think I've ever seen a video where it's done this, where it's educational, showing the concepts, but then actually trading it live thereafter and, you know, calling out price, essentially. I'm very excited. No one better than, of course, with Fabio.

Yes.

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Giveaway every single week. Now let's get back into the episode.

So we are here, we are stuck in a range, we are on fair value. Before we treat to do a recap we saw this punch to the wall, the aggression of the seller, the follow up to the balance area and now there is the first piece of information that we can get that was not present before is this bunch of aggressive sellers without follow up getting to the discount level, getting back inside the range. So I think as I was saying before that this high for the day, it's something that will get destroyed probably at the beginning of the market open because the structure that I see now, even if I have the information that sellers are getting aggressive and building up here, the structure of the market that we never need to forget is still bullish. And as you can see this is the level where the majority of aggression is getting. This is the level where sellers are getting really aggressive. There is a dry up of volume and as you can see a low volume node. This is exactly what the market printed here. So in 20 minutes we have the first setup. Probably that can either be breakout here, breakout and test if the volume is supporting it. Otherwise we can get a buy from the discount. But this will be more risky. From here you can see that they are starting to fight because it's pre market opening. This is the reason why I never trade the pre market opening. Because you see the battle but you don't know who will win it because we are stuck in a range. So from the data that we have seen here, the size of the bubble is controlled by sellers. So it means and also the price is going down. So they are winning the battle. But we need to remember that we have these big boys here ready to protect the price. So at the moment I don't feel confident to check any setup. I prefer that we check closely. We should expect the first drive not at market opening but five minutes before. And people that trade will see it often like they are preparing the dealing range, testing on the market opening and then getting the direction. So what I expect is that if we are going to get really long, this I needs to be taken before 20 minutes. So I mark this I if we're.

Going to get long.

If we're going to get long. Now I will create some scenario that are all rule based. Okay, so let's remove this one and let's make some scenarios. So the first scenario is that these sellers are going to get absorbed. Okay. Now if these sellers are short here, probably they are going to get liquidated here. If the price during market opening spike ups really hard, they are forced to close their position. Closing a cell will create more momentum long. Okay. Watching how much they are pushing short makes me think that they are either closing long position. From here, either they are getting some scalp pre market opening and price will get back to this level 21822 before skyrocketing long. If we need to be conservative or it's the only setup is breakout here. Test the level only when you have a closure of the candle. We go back to one minute so we get the real execution. And the market now will prepare the setup for the market session open. So aggressive sellers, this can be Seen also at what traders call fake out. So the fake move before the opening and then collapsing. Not collapsing, but rising up, as you can see. Let's make a comparison. The size of the ball, the Red Bull, it's bigger, right? Yeah, but the result is really bigger. Like with small volumes, buyers are getting better results, you see here. So it's really important to see, to plot. This is something that I do often to put a profile from the first ball to the last ball. Okay. Like this. And check who is going out. I show you. We can always hide the trades so you have only raw price action and volume distribution. And you can see the sellers are not yet managing to close their candle below the value area low. So we are still even in a small time frame and a small data range, we are still consolidating and compressing. Yeah. The direction of the market is not clear at the moment. And usually it gets really clear. The direction for the day from 15 minutes to 30 minutes inside the opening of the session. So it's normal. It's totally normal. What's happening now? They are loading position. Now this one, it's already a big information for me. If this candle stays like this and we take this high, you can also try the aggressive setup. But we will only use the model that I explained before. We will not, because people can get confused with too much information. So let's go easy. But as you can see, they put aggressive sellers here. But the follow up, it's almost zero. Why? Because again, the buyers are protecting this position.

Yeah.

And in the overall bias, if you see what's happening at the moment, is that from the previous range of compression the market tried to break out. Yeah. But it failed. So structure wise, we are still long.

Now let's remove all the unnecessary data and let's put the big trades.

And one thing you mentioned was that those big trades previously when we were looking at the charts, there wasn't that many because we weren't in session yet. The session had getting huge. And you said like when we're in New York session, you're going to see it like so much. And we're not even in the session just yet. But you can already see an increase.

You know what I like about this, about these tools and this platform, that volume is balls are proportional to volume. So when there is too much volume and not clear direction, your market get flooded by bulls. So it's not visible the price and you are forced to stay out because you cannot see what's happening behind. So it's like an Insurance on your hand to stay calm. Like do not do anything. And what I would really love and the my favorite setup possible is when market explode following up by green level. And you can just jump in at the first level when it pulls back in a low volume node. This is amazing. Now this is totally normal. And this is the reason I strongly advise not to trade like 10 minutes before the session, 20 minutes before the session. Because you will be liquidated and then maybe your direction was right. Yeah. But you will be fucked up by volatility. This is something that not all traders taking into account the volatility range can change by session. So a model that works for rundown session. It's not guaranteed that will continue to create alpha and generate revenue in the new year session. An example of this is the mean reversion model. You will see now if we apply mean reversion model here we will get destroyed by market and you will get also slippage because it's normal compressing here still the entity of the sellers is huge. But there is no follow up. What does it mean that someone is absorbing this order and if they are absorbing this order. If you watch only color you say it's controlled by sellers. But I still have my narrative long. I still think that we are going to get the high for the day.

Momentum is building up. We are getting 10 minutes around 10 minutes, 13 minutes before the session. And as I told you we are high to take to target the design. Now what can we expect when we target design? Explosion like acceleration like we were seeing before. Why? Because these huge orders are getting close. They don't want to be before session.

Yeah.

With this heavy and being in the wrong direction.

Yeah.

So they tried to anticipate the fall down of price but as you can see it's not going really good for them. So we are going to see when the market approach exactly this high.

As of now still not getting broken. What we want to see is these green balls here like we did in all the previous situation. Yeah. This is a good setup for follow up.

Aggressive setup if we want to cover everything. One aggressive setup can be the anticipation on the first ball with a stop loss below the sellers to get to the high. But it's a setup that you are still trading the noise.

Yeah.

So something that you cannot expect will have the same win rate of a good frame trend following setup.

So you see when you get back inside the range the balls are so big that you cannot even see what's happening. And this is keeping you away from interacting with the Market like transactioning.

In terms of like what parameters if any or settings have you put to identify these large orders. Is there specific?

Yes. Yes. For the 5 minutes and 1 minutes for New York session you can use 30 contract as a filter. 30 contract. And.

During London session you can go with 20. It's pretty accurate like this.

And so the larger is that mean.

It'S more than 30 the more maybe these are 100 contracts got you like so big and I created like this proportional. So you don't need to click on it see how much contract. But you immediately see that there is a big sell aggression there. Gotcha. Like it's C sell. I was expecting that the I buy will be but sellers. So they are still keeping here. Why before session they are still keeping here because the direction is not clear who want to transaction here. When you can get website high, website low, you are out of the market.

Yeah.

You are getting liquidated with every direction.

So and these buyers or sellers they can be anyone. Right. They could be, you know, a retail trader with large capital. Or it could be your funds or whatever it may be.

Exactly. Exactly. Now an information that we cannot unsee is that at the idea still loading short. Even if the market is going to push the eye. So the narrative it's a little bit shifting because if this low gets taken we have this breakout is interesting. Also the short till here. Why I will not take this position because the whole picture is long. So why should I take one to one risk to reward when I can wait and get a 1 to 3, 1 to 4, 1 to 5. This is the model we need to use. And the model is keeping you out of a lot of trades. We need to be evidence based and oriented on a large number of sample. Executing 2500 sample in a world cup can give you the taste of what's worth to do and what's not worth to do. Because maybe one times out of ten now we go short.

Yeah.

But all the other times the seller are getting destroyed and the test is here and you just lose. Yeah. To get a so small movement.

That's because I think that's one thing that's universal across any trading strategy is that you focus on quality.

Yes.

Rather than just anything that could work or you know this has a chance of working and it could work 1 out of 10 times, whatever it may be. Because I feel like that one time you do take and it does work. It always just reinforces you the next time to take it again. Right. Take it again, take it again. And you know it might work two, three times if you're lucky and then the next 20, 30 times it's not going to work. But you're still thinking on those two or three times. It does. Exactly. Versus when you have an actual plan, you know, quality trade playbooks and you follow those playbooks. That's where your consistency will come from, your longevity will come from as a trader. That's where you're really going to start to scale your journey. And scale your journey doesn't mean that it's going to happen fast. But what it means is you will have progress. And the funny thing is it will happen faster than the alternative of yes.

The lowest road is the fastest road. So it's always like this. Now what I'm doing in precession is marking up the biggest delta volume. Yeah. So I want to know.

So delta volumes on the left, right?

Yes. I want to see at the market opening which level I can see that are getting tapped. I want to use different colors so I use just deep red for this one.

And for the buy part.

I take the swing from the low and I see what's the level with most amount of volume. That clearly is this cluster of by volume. Yeah. To be honest there is also this one is smaller but it's still here.

And these are the level that we can see in seven minutes getting visit. And from here we already know what to expect, when to expect it.

So do you sit on the five minute time frame when marking out your analysis when it comes to execution wise one minute.

Yes, just clearly like this.

Now chart is only showing us the levels color. We can see the aggression and we can see the actual execution. So now we don't need five minutes anymore. We can just go down to one minute.

Can zoom in. You see how much they are big. When you go here you can see clearly that. But this aggression at the moment is getting completely absorbed. This got absorbed.

Do you ever think like for example in this case this person tried to sell got absorbed. Could that be the same person like stacking into a trade or is that not.

You cannot know if it's the same operator but for sure you know that these traders are in drawdown and there is still interest in the seller. So what they can see is that they are trying to build a sell position and they will be forced to close if market volatility spikes. So if I get these aggressive buyers and all these sellers needs to close the position, we arrive here and market opening and we are closed because it's 324. This is the first moment I would expect.

And so in this case, if price did break above this level, you're not interested in trading that to the next level. You're interested once price gets to that level.

Okay. Exactly. Because I need to.

So would you say it's still important. Sorry. To have this context. Even if you're not looking to trade to that next level, it's still important to understand what's going on.

Because you are training for the procession. Procession and creating a narrative. So when you know how to do it, you are still understanding with your subconscious mind what's happening. Because you need to be really fast. Yeah. And you need to reason fast. And if you don't do it, and you do only for your setup on 15 seconds and one minute, it's not enough fast to then execute at the right moment. You see how much volume and interaction is starting 5 minutes before. Like I told you. Not at 35 minutes before. They are preparing the order. From what we can see here, this is a huge information aggressive seller still to this level. Buyers with better results. All these are getting absorbed. This is not my narrative getting wasted. Or this is my narrative getting confirmed. So even more I should expect now that either from here or either from here, we reaccumulate in the last five minutes and we shoot up. All these sellers are in pain. They need to close. And the markets create an expansion move up. It breaks. I can take the long from there and I'm done for the session. Like one setup with high win rate.

But understanding the narrative before makes you also understand market participants. How they are thinking and if they are proven wrong.

Yeah.

With this amount of contract, you cannot hold anymore. Even if you have a millionaire account. You need to close sooner or later.

Yeah. Are these market executions or the market execution?

Not limits. I never watch limits. Like you can get to feel a taste of the market.

But because the limits apparently they can.

They can cancel.

Yeah, they cancel. So they. What they call it spoofing. Is it. Is that what.

Yeah. Is they call spoofing? Like putting order to create market pressure, then removing. It's manipulating the exception of other market participants. But with execution just. These are executed market. There is someone that is with huge.

Sell that's in the market.

You know that's there. If you. If it close. You see it. Yeah, you see it. So in this case.

So in the first minute of market opening, you will not see the chart. It gets balls.

It's. It will get like something like this.

Does this large aggressive buyer that failed up here, does that make You.

Yeah. You are getting good. You are getting. This is an aggressive buyers that created the failed auction. So the buyers here got like they tried really hard like this. But the sellers won here.

Yeah.

In this battle also the sellers won because they are transaction down. Yeah. So in this, that's the reason you wait for your confirmation and you don't jump here. Because even if the bias is long, you don't know if they will reach here or the second level that tracks. I only know that. I only know that I want to be in if this level gets broken.

Yeah.

So let's see what they do three minutes before.

A setup for a skull position. A little bit more risky is if these sellers don't have a follow up and got absorbed by buyers shooting up here. But this is a risk position. But this can be. I show you only to give to the audience a taste.

This one like risking $300 and getting 1100 is not a stupid position. It's just a position that you are taking inside the noise.

Yeah.

I can take this kind of position only if I'm sitting in profit for the day.

Okay.

Like it's not uncommon that I take them. But they need to use profit and not use market like account equity.

Yeah. Because using house money, right? Yeah.

Yeah. Like before I need to take money from the market. Then I can take this kind of trades. The win rate is lower on this. But if you consider the risk to reward, it's like one to four. Yeah. So it's. It's pretty good. I just put this risk to reward because I want to let you understand that if these sellers fail, they will catalyze up. Yeah. I need the first minute. If this one gets broken, the setup is not valid. But if in market open at 330, you recover this level.

Yeah.

Like, and this one gets not broken. This is the target. So let's see how the market will behave from what we are seeing at the moment. Sellers one. Yep. Sellers one. Buyers one. Yeah. Here. So you are getting a bias and a level that start to get interesting. Let's zoom in. It's not visible. So considering the platform, you should not interact in this position even before because you can't see. You cannot see what's happening here.

Because the first execution can be taken after market open and we are still before. So one trigger can be the break of this. I for example, for a long. So now that we are getting inside, if this I get broken, a really aggressive position can be entering at the break of this with the stop loss here targeting the high And I think it's even more than as a risk to reward. Even more than. One to four is one to five probably. So market it's opening. They didn't break the high. So no position gets executed at the moment. Now we are in the second buy area.

Yeah.

So we need to check how the volume is behaving at the moment. Now these traders are in profit. Yes. All these buyers that position themselves before the opening needs to close position. This will bring price. All this movement is made by them.

Now now that we are in market opening, we can start to take position or do analysis that we can actually use. So let's see. The first information that we have is that sellers still won this battle at the moment and they are getting stopped only here. Okay. So still in the noise. Remember our rules. Till we don't get here, the premium setup is not executed. So inside here what can be something interesting for us? The first information that we can have is sellers really aggressive here that don't have a follow up short.

Yeah.

So if this candle start to get populated by a lot of sellers. But get back here. Yeah. This can be a long. But again it's a long that you can you take inside market ranging. So let's just wait here.

Because you had, you have a level beneath this. Right. And towards the low.

I think the main level of the buyers are getting destroyed. Yeah. So the only reason I can engage in a risky position here is if this one prove me that it's a fake out. How can they prove me that it's a fake out? They need to recover all this.

Yeah.

This one needs to be a full week and they need to break up again from this high. If they don't do this. You see sellers are completely dominating this market at the moment. So not engaging here.

You know, in price action you can try this long because you don't see this. So you see, you think, yes, it's, it's retracing, I can buy discount.

No, you, you, you think like break and retest the level.

You know, this is, this is something that if you are price action trader, you cannot know not because you are not good, but because you don't see that they are willing to sell stronger at lower point.

Yeah.

So the auction is getting short. Which one is the first level we can protect. We need to go with the profile.

On everything they build. Also during London session, not only during the range.

This big area.

And this low volume node like also Carmine is doing. This is a low volume node and this is the delta. Yeah. This Is the last protection level. If this one is breaking, they are recovering this cell and they are collapsing and is excited.

And in that scenario what would you do? Would you just.

Then in the scenario that they get cell, my narrative will change because they break a balance level. Not on the up on the downside. So my day is short. If my day is short, I will still use the same model. Just I will not get long, I will get short. Like my long day gets activated if we break this. Yep. My short day at the same time gets activated. If we break the compression range. That is all this range. If they arrive here, we can try something. But here there is something that it's undeniable. They are on this level. They are pushing hard. But I don't see a lot of follow up shorts. So here the buyers. You see how many volumes so much. Yeah. Here the buyers are protecting it limit orders. So either they slice through it but if they start to recover and they get back inside the range, this is a setup that also Patrick Neely is using with volume. And you see the good part about volume is keeping you up, up, keeping you out of the market when it's not ready.

Here because let's go again to the narrative here. If it breaks the low, we get long. It continue down. Okay. Here if it breaks the high, we can go here. Why? Because if the volume don't does this. This means that the sellers are controlling all this market movement.

Yeah.

You don't need to predict, just need to see what's happening. Here is the first time for the market opening where buyers are protecting a level. Yeah. In an interesting. In an interesting situation. So this one can be the first long position if it gets confirmed by a little bit of buy aggression. At the moment it's only sell. Yeah. The moment it's only sell. So now the only thing to do is wait what what they can do now one position that gets really interesting is the squeeze of the trapped sellers. When is the squeeze of the trapper sellers? When you recover all the aggressive sellers. Yeah. They are getting fake out. So they are willing to close the position and the market is accelerating. I you know, let's see what it's happening here. This is the first footprint of long. Yeah. Position from the level that we saw. Still someone can think why you don't take a long position here. Because at the moment if you see who created this wing, like we were talking before, it's completely dominated by sellers.

Yeah.

This is a really risky position. If we start to get back here.

We can take position on the breakout with stop loss below the level. But remember, the model is one you need to break and Tesla's level. Otherwise you just stay out. When this level gets broken, the game start. You can add the position. You can follow up. You can do a lot of things. Now I want to show you how much it's useful to see this volume in higher time frame.

Like five minutes.

From here. It's clear. It's clear. Because you see, we agree that this is the low volume node. Okay. The profile distribution achieved the value area low. Okay. So we are on the value area low. The sellers didn't got a follow through. They took the law.

Yeah.

Okay. And created a failed auction. People call this manipulation. They try to break out and they fail. This is the reason we will get here.

Well, it's what you said, you know, before the open. It's going to set up and then it will whipsaw take out one side.

This is a model like the only things is that I don't get inside when they are like so aggressive. So my role is not to predict when they will stop. I just wait that they complete this movement. Yeah. You see, all this was a fake. The narrative is still by. All this movement gets absorbed one with which the narrative. When we break this level. We broke this level. No. So we are still by.

If you want to clear the position and for the New York session get a better tune of the market. You can raise 240 at the contract size. The contract and you will. The situation will be a lot clearer.

You see?

Yeah.

Situation. Now it's clear buyers got more than 40 contract here. They are just putting a lock and say below this level. You don't go like you. You try to sell with two. I absorbed everything. And they are recovering all the buy. Now all these sellers need to close the position. Yeah.

Which then causes a squeeze squeeze.

Like if all these sellers close the position, the market is jumping. And when gets to this level. You see the acceleration that we saw before. But short.

Yeah.

Like the opposite.

In the video that I made with Andrea. All the setup that I took are based on this model. Like squeezing the other part.

Yeah.

To get the acceleration and be immediately break even.

Yeah.

Be able to move at break even really fast.

Would you say that is one of the necessary skill sets when scalping at this level?

Yes. Like being fast and also creating shortcut on your platform.

Would you say that you always have been like been able to move at speed as a trader? Or is that something you had to train?

We are human reads. I Will be really honest. Sometimes I made big errors. Like.

You scale inside the position, but you scale. You don't notice that you are scaling not by one mini contract a time, but we are scaling. With five contracts there is a huge amount on nasdaq. Like one contract is really heavy and you need to find a good way to scale out. And you are with Takika Dia because like in scalping you need to be fast and sometimes you still make errors.

Yeah. Because a lot of the time there'll be human errors at that point, Right? Yeah.

And then, then with this volatility, look what, what the market did as I told you before, taking the high, taking the low and then being at the starting point like in the first 10 minutes of the session, we didn't do anything. We just liquidated the low. Liquidated the high.

Yeah.

That's the reason you don't engage before.

Now I want to show you these sellers are selling this momentum with zero results. Now we are getting back to this. When we get back to this, someone will need to cover their position.

Yeah.

When they need to cover the position, the momentum will start to build up. So let's see what they do. Still my narrative didn't change. The only thing that could change my narrative is the breakout of the level still compressed inside here.

And we recovered also the major delta point here. This means that we are above the strong selling level of the distribution. And if we are above here, we are also above.

The value area high. And you remember before the reaction that the market had on the value area low.

Yeah.

Like it completely used this as a pivot before collapsing down. Yeah. The same is for up. Like there is an overlap of this area. And now I think they are so aggressive.

If you wanted to be aggressive, these are, you know, this was a trade at the low you could have taken. But again it's like not wrong, but it's super, super aggressive. During that time window that really isn't ideal.

This one you should not expect more than 40% win rate. So you can take it. But remember, you are trying to take a falling knife. Yeah. A lot of times you will get cut and you are buying the contrarian momentum. So you are trying to stop the price with the big market participants after a lot of test. And here it's more easy to who is winning the battle. If this law gets broken, sellers are winning. If design gets broken, buyers are winning battle. Okay. Now you know who won the battle. Now you can engage.

Yeah.

Don't try to anticipate. This is the main reason why A lot of traders lose money. They try to anticipate what the market is doing before the market does it. And they get so attached to their narrative that they are not willing to change. As I told you, my narrative was long from the beginning. The market did an aggressive sell off. I was ready to change my narrative and say from this moment, if it breaks, I start to search for short. I'm not marrying my position, I don't care.

But you have specific levels that invalidate your bias.

Yes.

Getting excited.

It's not so big, the volatility today, to be honest. We are on the five minutes. I think they are waiting if there is a news of the other bombing because.

Yeah.

So for context, over the weekend. Today's Monday. Over the weekend, the U.S. had bombed Iran in three different sites. We gapped, I believe, lower on NQ. This is NQ. Right. So we gapped lower the gap, we recovered the gap which we then started recording earlier. We then actually sold off and then recovered again. So we're kind of in a range at the. At this current stage.

The squeeze gets completed here. Yeah. Like if they attack this eye and all these are squeezed. Yeah. So here we can expect.

So it'd be similar to what we were looking at over here.

And we saw this here, we saw this here. And they build momentum. Now the squeeze that you see in London, it's much less. Yeah. Less squeeze that you can see here is three times this candle. Yeah. It's pretty aggressive.

And what is it that you do when you are, you know, active? Let's say. Is it a different saying? We're recording and everything, even though you're going through the same motions. But when you are waiting for these 10, 15 for the price to get to the right areas for you, do you still sit and watch or do you have it up? Maybe some alerts and you're doing other things.

You can put alert on levels now, considering that I don't want to transact inside here, my first alert will be here. So just here.

Yeah.

Otherwise you get the temptation. Yeah.

It's like I've been controlling himself.

Yeah. The temptation to get. Because here it was really clear that the auction was failing. A lot of aggression and no follow up. But. But it's not your model. Like you are trying to put some intuition inside the model that is already proven to make money. Yes.

And would you say that when you first started learning and to really look at the market in this way, would you say that you fall guilty sometimes in the beginning of, as you said, trying to Use intuition and trying to maybe over predict and over trade almost because you feel like okay, I can see these sellers or I can see these buyers. And you start taking executions outside of your model.

Yes, of course, you know the Dunning Kruger effect. When you introduce in your mind a new concept, you think you understood everything. Like if I introduce now order flow to a projection trader you will say oh, it's so easy. Yeah. Like there are balls. I take. There are no bolts. I don't take. No, it's not like this. So in the beginning when I introduced it and my model was this and they see aggression and not follow up, up. Even if the model is not completed and it's not, I say but why? It's free money. I jump in and then I say when you journal, you understand the error that you did. So when your mind is cold, you understand what's the real error. Not before. Yeah. They are starting to squeeze. You see, they try to break out the eye a lot of buyers aggression. But the sellers still are pushing down limit orders like punch on the wall from the buyers.

Yeah.

But the fact that they already reached the eye, it means that the sellers are not protecting the level anymore.

So for example, let's say if we at this point we see buyers, let's say we don't close above is our likely scenario from here probably to get to here and then see again if buyers or sellers win at that level.

Yes. Why? Because this is the level of protection.

Yeah.

And the candle is still not close. So these are still building position. But. But if you start to see rejection, this is a level that you can revisit. Now the point is that if you enter here where you put your stop loss because you see how much is big this candle.

Yeah.

If you want to be safe, you will put your stop loss here. It's not worth it.

Yeah, of course.

Like it's. That's what I was saying. When volatility expand.

Yeah.

You need to make a lot of consideration that you are not making in London session. Because one candle in London session, you can go short here and protect you here and it's okay. Yeah. Look here you need to protect here. It's not worth. Yeah, it's just not worth the trade.

And yet traders will still take it.

Yeah.

Because of that. As you say that trying to predict or try and say, okay, this is what's going to happen.

It's broken. Yes. Okay, I engage. I can start to engage to go here if I have some profit for the day. Otherwise this level, we stop here but you see this buy here getting no follow through. Some trader that is getting new at order fluency. Maybe I can try a short from here to here. Okay. Where you put your stop loss here. Is it worth it? No. Completely. No. You are risking more than you are expected to.

Exactly. In terms of a position at the high, the one that we're waiting for and looking for price breaks above. We do our confirmation, we get in. Do you already have a preset that target in mind or is it something that will depend on once we've broken?

So the first target is the. The one with the highest win rate. It's the previous daily high. Okay. So if the previous daily I was above, we can go to checking me now. Let's check here. Because they are building.

They're building. Yeah.

And they are preparing the squeeze. I guess you can see is the first time that a candle can accept here. Now if this was happening here, this is a trade. It's happening inside. So still if they accept here once some. This is a breaker test. This is a real break and retest, like covering yourself below the aggression and going through the next level. And it's still 1 to 3, 1 to 4. Risk to reward ratio. Okay. You see how much is different watching only Kendall and watching the momentum that created this candle to break out. Yeah. Like you know that this is the level. If you want to trade back and retest. You need to protect yourself. Yeah. Yeah. And the first target that makes sense is the level that we considered before. We are not reinventing the wheel now, considering that we still didn't reach the high. I can go here and mark up the previous daily high. We have a lot of room. You see if this is the first target. Yeah. A huge risk to reward. If it breaks here and test, it's 1 to 10, 1 to 20.

Now.

Sellers trying to stop back in.

Yeah. Failing.

Yeah, failing.

So let's recap what happened. The narrative was long from the beginning before getting us the opportunity to be right. The market took the low. Why he revisits deep discount area. Then he validated the first level of squeeze. A good squeeze is when you approach the level and you see aggression and at the same time you see follow up from price. This is a good squeeze. Yeah. These sellers are forced to close position here and what they will create more and more momentum. Yeah. Okay.

When price did come down here, because obviously we're recording this and we're live. And what are your thoughts like? What's going through your head? Do you feel when price is down here like. Oh, you know, I was thinking.

No, no. I was thinking, to be honest that you will break the law. And I was already preparing my mind for the narrative to be short for the day. I only start to change my mind when all these sell bubbles pop in with this buy. Yeah. And they see that all these have zero efforts. So I I trace this and I validated. This is a low volume node. It means that there is not a lot of transaction here. The first transaction is this level where there is a huge delta on buy volume. Yeah. This is exactly what stopped price. This bunch of information profile low volume node aggression and lock in from buyers is something that can validate. But as I told you, I never told you I will go long from here.

Yeah.

Because it's just too risky. Like you can get low. Now this one was the only position that I told you. If you are a breakout traders and you want to take, you can take this position and just trail your stop below your bubbles. Okay. And take it.

If you were to buy there, where would you stop? Be under the candle.

If you want to buy here. Your stop loss can be below the aggression.

Okay.

So it's really aggressive. Like let's say that the market just test this movement. Okay. And your stop loss can be below the big orders.

Yeah.

So it's a stop loss of $200 to make 600. It's 1, 2. This is not bad.

Yeah.

But it's still a position created by market noise. Yes.

Is still not my setup still in the range.

For sure there will be some more the flow trader that is profitable doing this. Yeah. But I will never do this. Because the probability that the market with the volatility of New York session will get back here and do this movement. Yeah. And create just a week. Then you are right on your position. But maybe it creates a weakness is really high. Yeah. So in this case we were lucky. It filled to the to the pip. It rejected. And when if this breaks the law, we are already zero risk. Exactly. So you are fast. You are really reasonably fast. But if I had to advise to a friend. Will they use this model? No, because it's help of stress. Imagine that in one minute on in five minutes you have to trail on the next block. You need to be really fast. Imagine risky $5,000 on the position.

Very true. Yeah.

You need gut.

But when the the range of the New York session is clear and you have a breakout of the compression. You have data supporting is to the point that there are a lot of studies about initial. Initial breakout. Like you Know the model initial breakout. When Mark New York American equities break out the law. Yeah. Or the eye of the New York opening. There is a huge probability that they will continue. So I'm using a structural inefficiency of the market. Yeah. Just timing it better than usual traders because I have order flow. But I'm not reinventing the wheel. Of course this is nothing exceptional about it. And it's the fourth time that in this timeline we come back to the level that I told you and we still reject sellers. 0 result buyers aggressive new auction. If it breaks this low risk. Zero. Yeah. Like.

It'S incredible to witness now what do you think to the. The term or statement that people make in terms of buy low, sell high. Because in this case what we're buy low, sell.

I it's. I'm totally opposite to it because I.

Was thinking I had the low there where we, you know, I would look at and I'm sure a lot of other people would be like oh, so if we're long that would be a great place to buy. But as you say that yes you could. But on the most chances.

No wait, you can have it if you are like if you know the fair value of the asset. Like if I would be doing this for a car that I already know the market price.

Yeah.

That. That is stable. The market price. I can buy low and create my business around it. But market there is not too high of a price for one asset. Yeah. Because the asset price change constantly. You know, so it's by low. Low compared to what exactly. Low compared to option flow. It makes sense. Low compared to order flow. There is no law. You are buying high. I will never sell this movement. You see what is doing now? This one is already zero risk. Yeah. Okay. Some minutes now starting to get interesting for sellers because we are reaching what the level that we mark out four hours ago and he's still holding.

What would you expect you would you expect price to. Or would you want price to break through aggressively or would you actually not mind? The price reaches the level, sells off a bit and then breaks thereafter. What's like the. The prime. Like the ideal scenario.

I expect the sellers to get destroyed as what I told you from the beginning. I expect aggressive market participant to step in as soon as we reach this high. A little bit of pullback and then.

Growing going aggressive. As I told you, by the first 15 to 20 minutes of the session, the direction is clear. And it's exactly 20 minutes for me. The direction is clear. Yeah. First position was breakout. Rates to get the high. But you are still in line with statistic distribution. Why? Because you are getting a movement.

Yeah.

When a level gets broken supported by volume and you are getting out your position before the level.

Yeah.

So you are not trying to. You see, if we keep the target to the high, it's really rejecting. Maybe now it does a whipsaw and then explode.

Exactly. Was amazing to see. Especially for the fact that. Okay. We didn't take this position because. Didn't fit the playbook.

Didn't fit the playbook.

We don't have the house money from trading earlier, for example. To take the risk.

Yes.

And the. But that's I think so important to highlight because a lot of traders out there think you have a bias. Anything that fits our bias, you take. So in this case, for example, you, you. Let's say you came in long and you would take a long. You try to take a long at the low there. You try and take a long there. You try any long that's possible. You try and take.

Right.

In reality you have your playbook. It doesn't matter what your bias is. As long as that playbook hasn't presented itself, you do nothing. Why you say on your hands.

I think they will get a lot of value from concept wise from these trades. Because this is explaining exactly. It was beautiful. The market.

Yes.

Yeah.

Because even that I would say that that's not the. It's not the worst trade in the world. Right. It's. It's with the bias.

One, two, three in three minutes. Like it's worth. It just.

Depends on your playbook.

Yeah.

So yeah, it depends on your playbook. That's what I'm saying though. It's a. It's incredible to be able to see, okay, we had a bias. Here's a trade opportunity played out beautifully even with the explanation as well in real time, which is most important. Yeah. It's phenomenal to see and we're excited to see how we continue to push through.

Now what we should expect here is revisiting this area. Why aggressive buyers fail, not holding failed. We knew exactly. We placed our target exactly where we should expect a reaction. Now there are two questions. First question is how much deep will be this retracement? Yeah. Second question is we want to be in a long position if we get back here. No. Why? Because it's still not clear the dealing rate till these big boys don't fail. And says because the good edge is that if this big boys gets broken.

Yeah.

This needs to close position. And if all these dealing rage is getting in suffer.

We are skyrocketing high. And you will say how is it possible that we are a skyrocketing guy if we have a situation like this from global macro perspective. That's the good part about order flow. You the market already includes all the information possible. You need to read what the market is telling you. Not putting the pre concept of no, it will not do this because there is that. No, your role is only to read data.

The market itself.

The market itself, there is no better mentor than the market.

So is it the case normally then? So we'll see at this point. This is a previous auction where sellers had won. And in this case, because we've seen buyers try to step in, fail, get absorbed, we then would expect the previous auction to be revisited to see who's going to win that battle. And essentially it's a constant flow of what is this as you say, expensive or is this cheap? Buyers are happy to transact out and win the transaction or sellers. And therefore we constantly have the next play ready, the next play ready according. So if for example, instead of us, the buy is failing here and we actually won and we broke above.

We.

Would then as you said, there would probably be a squeeze.

Yes.

How would you. Let's say if that was to take place, where would you look to try and enter? If because a squeeze, let's say a squeeze takes place. That'd be quite aggressive, right?

Yes, it will be quite aggressive. It will be with a lot of big trades inside. I will plot my profile.

Yeah.

Search for the first low volume node, jump in with a really tight stop loss and get the explosion.

Okay.

And this way you can get really fast. 1, 2, 3, 1, 2, 5. If you have five art for the day, you're done. Yeah. What you need. It's a beautiful trade. And the good part is that if you take two stop loss, the stop loss is so small that you can afford to take three or four stop loss.

Yeah. And you on average, what do you look to risk? Does it depend on the day or the zero?

Usually I risk 0.25 per trade. Because I trade personal account.

Yeah.

And in the Robins cup I reach till 0.5% per trade. Sometimes when I get above 100 of return, I get to 1%. Got you. But I will my role is always keeping drawdown low because commission, it's really heavy there. Yes. Like 600 execution per quarter can cost you 10, 20% of the account. So it's like you don't need only to make profit. You need also to repay commission. So it's just not convenient to execute what's happening here.

We're seeing the buyers trying to. Trying to break this level.

They are getting aggressive to the eye. What does it mean that they are willing to pay higher price for this asset. So is it too expensive to buy? No, because if it was too expensive, aggressive buyers will not participate here. So it means that still my narrative is buyer. Even if I didn't break this level, I already know what to expect for the day. Already know. And we are getting ready for the squeeze. The squeeze will be present here.

Look, there you have it.

This is the squeeze. Now what can we expect?

Really fast analysis. This is the bunch of aggressive trades that are populating this movement. Yep. I will not plot the profile because this is all of volume node. Yep. They didn't transact efficiently. So the first position that you can take here is protected by this area. Okay. So if this candle close in its only five minutes, it can either give us a follow through. So break of the eye and we get a retracement because remember, we never take the first drive.

Okay.

Because it can be a fake out.

You want the confirmation?

Yeah, yeah. See it can be a fake out. It can be absorbed and snap back.

I'm getting too excited. I'm like, yeah, execution, let's get it, let's get in here. But this is why you're the professional and I'm the podcaster.

But it is incredible, honestly to see, you know, play by play.

We can have a position here. If it breaks the law. You can get the first position of risk here targeting a 1 to 2. So we are risking 6, 600 to make potentially double 1200.

Yeah.

And if we want, we can also trail our stop loss to the, to the high and the high. It's a huge risk to reward if it achieves it. But our role now is to put our stop loss to risk zero as soon as possible. Yeah.

So this long executes if the high gets broken.

Yeah. This execution can be on buy stop. Like if it breaks the high, you can be inside the position. Now this makes sense because we are protected by all these big orders. Yes. So as soon as this week gets taken, you are just inside and you are covered here. Why? Because look what's happening here. If this. Okay, we are inside in this position. We are risking $650. If these sellers are getting aggressive and we are getting annihilated. We want to be out as soon as possible because it means we are wrong at the Same time, if we see these sellers getting completely absorbed by buyers and continuing up, up doesn't trail the stop. And we are.

If we go above, would you say that it would. Would it cause a squeeze? Because. Especially because of the size of.

You understood how it works. Yeah.

So if we break above now, for example and we continue higher in terms of trailing your stop, would you be then trailing it beneath?

It's not. So defeat.

Is so interesting because as I was saying to you earlier, like I think a lot of people have a huge misconception with they think for their fluids hard. Yeah.

Just order flow is reading an Alphabet. You need to learn letters and then that's it. But it's really strange what's happening here because it's not common that you have a breakout and you don't test. They are leaving a huge low volume node. The only thing I'm afraid because consider that we are now in the position is that in the test of the low volume node they will spike out but we, we will take multiple position in this case. Yeah. So they are pushing the eye. What does it mean if they are pushing the eye and make another drive. This big boy needs to close the position because he's losing. And if this boy needs to cover himself, the squeeze can get interesting.

Just analyzing balls, not price.

These balls look just a game of balls.

When they start overlapping it kind of looks like ICT's enigma, you know. Yeah.

This is how, this is how it's really going on.

Yeah. But no, the algorithm is saying that we are going to get long.

It's not orderful. It sounds good.

Is incredible though.

You can only understand what is price because you watch this line. You see this.

Exactly.

Exactly. This is so interesting. Honestly. But I'd love to. I do wonder, you know what the audience are thinking at this stage, you know what they would feel trading this live. Especially when we were down at the low at the open when you said that we'll see a shakeout. I wonder how many people would probably be looking to either short probably been stopped out already and trying to revenge trade or get back in or like what would that look like, you know, for. For a lot of people. Because I can imagine down there a lot of people probably would have been shorting, shorting, shorting expecting, you know, a follow through down. But then. Yeah, especially after the gap's been filled as well. Right. Because a lot of people would assume be gap filled in London. We're going to then continue lower. Right. But as we can see but in.

What'S good about you. What's, what's happening. Like the sellers. The sellers are getting completely destroyed. And soon we have the.

This is incredible.

Soon we have the. We can put the stop loss at break even.

Yeah.

We have a long way to go still.

So at this stage, would you have scale move the stop loss beneath the. The red, the red bubble there.

There is only on. I will not do it. And they will be happy to take a stop loss if it's not back at me. Because there is low volume like you, they can push a spike really fast and they get liquidated in a really good position.

Got you.

Yeah. Like this position. It's only one contract. Can give you 1,000. Look how much it's pushing. Like.

That makes sense.

Yeah. Now we got, we enter here and we got one Lazer green line. You cannot expect anything better as a trader. Yeah. Because you are just. Psychologically, it's way better than being included in this mess.

No, very true.

Yeah.

Very, very true.

It's time for us to put the risk to zero. So now.

So now even if it comes to low volume node, it's fine because you've taken zero and you have a chance to re. Enter that. Yeah.

Now you can play this game in a lot of ways. You can scale in again. You can put this stop loss to break even and use this amount of profit to open another position because you have another lock in here. What does it mean, lock in? This seems like the MasterCard logo. But it's sellers getting aggressive.

Yeah.

Buyers getting more aggressive than winning. Who is fault? You see, they are winning. Now when I tell you, you. What does it mean? Buy low, sell high. If they are willing to pay a higher price to push the price down. There is no discount, there is no premium.

Yeah.

Like it's is just stupid. The concept that they are trying to push to the audience because here the only thing the market is telling you is that buyers are willing to pay more to buy nasdaq. That's it.

Yeah.

As simple as that. You don't need seven screen. You don't need a huge amount of tools. You are. We are just, just watching the real nature of the market. Orders, not candles.

So if you were to add there, would it be a case where you want to close and then a revisit?

Yes. In this case you will take profit because it's already like half is like 1 to 1.5 when it was here. So you can just close and use the profit to take another trade on the test. We are not doing this, this model because.

This Low volume node scares me. Yeah. And I'm really. I don't want to say I'm sure because I hope it will go good. But I know my, my chicken, I know my Nasdaq. And usually at the session it's just give the first drive.

Yeah.

Pull back. Yeah. And create. But we can just. Now we are. That's the reason also I got aggressive with the risk zero. Because we can take it another trades. Otherwise use the profit on the first one to take another one. That will be even better. What is telling us the market now?

Just analyzing raw data. The buyers at the top are not getting accepted. So it's getting expensive. Yeah. If it get expensive, we should start to see some sellers here.

Yeah.

And if we see sellers and they win the battle, we are fucked up to the point that if these levels gets broken, we can also go to stop in profit of €1,000. Not 1,000 like 8,800 Euros. And say if it goes bad, we use this profit to make another trade.

Gotcha.

Yeah. But the major movement of the day, we took it in the first 20 minutes. That's the major movement of the day, the break. Then you can play it long term. Yeah. And if you play long term, you have 1 to 10 risk to reward, but you get a lower win rate.

Of course.

Or you can just say give my cash session is done.

Are you able in, in futures as part of this, are you able to like partial your trade?

Of course. Yes. Yeah. Yes.

So is that something, is that something you sometimes do? Like let's say in this example. It's a good one to be fair. Would you for example, you had multiple contracts on and you're in this position, Would you say considering that I go.

Heavy and they go with multiple contracts, when I see this rejection, I will already take out half of the contract because I'm risk free.

Exactly.

I can take profit and they can continue to scale in if I want.

Yeah.

Okay. I don't like when the market gets weak. So I will take out here. But education wise I want the trade to get completed. Either we are stopped out at break even, either we go to take profit. I don't want to.

Create additional difficulty of trade management that is advanced. Yeah.

Because even then the trade management is quite personal part of that.

That like it's a big part of the.

Well, when it comes to say the high of previous day. Is that something then let's say you've taken half off, would that be your next sort of target? Or if let's say price goes to you Know one to three or four and then shows similar where we're getting a bit of weakness. You want to know everything, give me all the secrets.

So the point is you, when I told you I will scale out. It's exactly. Because when you see this, the next next step is aggressive sellers.

Yeah.

You, you coded the algo.

The next step is aggressive sellers. Now if aggressive sellers gets recovered. Yeah, this was funny. If aggressive sellers gets recovered, we should expect another explosion up the second squeeze.

Yeah.

Okay, so let's go back to your question.

Like because bearing in mind, right. The each one of these is 40. You set it to 40 contracts.

Right. But these big balls, maybe it's 100.

Exactly.

These are big boys. Okay. So I would like these big boys to be squeezed or to get back to the low volume node. Yeah.

So for example, we were at the high there in real time or you know, if we weren't in this setting, you probably would have taken half off.

Off. Yes.

Let's say price comes back to break even on that trade, no problem. But then you're going to look at the reaction from the low volume node. Is it again a confirmation based?

Of course. Like again, if this one goes to half profit and half breakeven, I will use half the profit that I made to wait for the trades there. Because I'm pretty sure that if we get back to the low volume node, we get aggressive buyers, we are going to run to the high. So you can create.

Just bear in mind, where did this get to? It's got to about 800. You say €800?

Yeah, like 800. But I'll fit 400 exactly.

Now it's easy for people at home to maybe think, oh, this is only one contractor. Exactly.

Yeah.

Because I was gonna say so like you know, you make that 10 contracts, for example. So you would have taken 4,000.

4,000.

Yes. Within a few minutes.

That's the point. The more the account size, the more you feel confident to get continuous profit for the day.

Yeah.

And then if you want to scale in, you scaling with the profit. Profit, this is you anticipated. What I wanted to say to you, like how I did this performance in the World Trading cup is building profit for the day. Building profit for the day. Building profit for the day. And in directional days, I risk, for example, in 10 trades, the profit that I made for the day. And you get a huge percentage of course, but you are only risking profit of the day.

Yeah.

If the day gets close, this profit is locked in. It's equity, it's not more profit you cannot risk it.

So the next day, reset.

Reset. Yeah, yeah. And if you think about what's the concept of this? When the model goes well, you take risk because the model is respecting what you're saying. If the model goes back. Ready for the squeeze, huh? Ready for the squeeze. Coming Sellers aggressive here, no follow through. Yeah. So we need this eye. If this eye gets broken, we go here. Yeah, done. What was I saying? That you build your position with multiple scalps. And this means that when the market condition is favorable to you, you make a lot of money. Yeah. When the market condition is bad, you take the first two or three stop loss and you are out.

Done.

One trade, the next day, everything covered. I have a maximum stop loss for the day. Like in percentage term, that is 2%. So when I say to people, this day, I took eight stop loss, I only lost 2%.

Yeah, exactly.

That's what they don't understand. They see the, the time, maybe they are risking 3% per stop loss. Of course it's a lot, but that's not how you deal with risk management.

And what's important to highlight as well as we were talking about contracts and you know, if you had more contracts, this would have been X amount. What's important to highlight with that is that that's not where you start. Right. You start with the micro low. Yeah, micro. You build over time and, and I think people hear over time and they automatically assume that's a long time time. But it's all perception.

Right?

So like if it takes you two to three to four years to really start to build a position size up and your confidence and your skill, isn't that worth being able to make 4, 5, $10,000 in a day, right? In a day, yes. But then don't hear that line and think, oh yeah, that's, you know, that's incredible, I can do that ASAP and whatever. It's the three to five years of dedication and hard work and really intricate details that then allows you to have that skill set. But it's like a lot of people aren't willing to sacrifice and understand that. And as I said, this is a, this is a strategy and a playbook that is truly for trade actual traders, you know, not for people who like the idea of trading. If that makes sense.

Yes, I totally agree with you. And also, like.

I know it's easier to believe in the fairy tales of the metatrader bot that makes money for you when you sleep or just the signal service that is able to put money to put food on your table when you don't do anything. But that's not the reality. And the message to the audience. Trust only people that give you some sort of verification or even better live analysis. If you can live trading. If you can track record and understand if they are doing what they are saying they do. Yeah. Because there is a big difference between people that make money with the market and people that make money pretending to trade the market like with service connected to them. In this case, you see they revisit again the big trades. Yeah. Not follow through. Going back to the now I remove a little bit because I cannot really see price. So let's remove it.

So the message I want to give to them they he didn't take out us on break even on the second position, but we took out position here. Half of the position. You see how much this level it's important and this level the market is using to pivot. This is not the case. This is when buyers decided that it was too expensive to continue buying. So this is the cap of the auction. The Mustang got too much expensive for us. Yeah. Yeah. If they are changing their narrative when we will see another candle we can continue to trail our stop to stop in profit like it's not ringwent in the wheel. I will keep this visual for now without big orders because otherwise I cannot see where is our break even. And here is our premium setup. If we are willing to go back and cover the low volume node, we will use half of the profit that we made to strike up even with one contract. This can be a $4,000 trades if we wait for the eye.

Yeah.

But we need to stay here till evening because I think the volatility I can see it was big in the beginning, but now it's drying up. So let's see. Let's see. At least if we reach the target without taking out the other position at breakeven.

That other trade that we discussed in terms of outside of your playbook and some traders might have it in their playbook.

And you said that with that trade it makes sense to target the. You know, the. The ceiling that we had at the time.

Yes, exactly.

Because you don't know if it's going to break higher.

Would it be if someone was taking that setup or would. Would that be a setup you would take if you had already traded in the day, made some profits or even then it would be.

Because it's not a bad setup. It's a good setup. Just let's.

Would you take the full setup out here or would it if in that case you had multiple contracts, is that another one where you would say half.

Off leave or I do something really smart. Okay. I take the setup out here. But I'm ready to open it back with the profit I made if it breaks.

Okay, so then you.

I don't take the risk of indecision here. Okay. Yeah. I. I bring the money in my account, then I'm willing to put the money on the table. Yeah. Yeah. If I have a confirmation like it makes more sense. I tried what you say to keep it.

Yeah.

But seven times it's not back. You get the break even. And you say I should I. I can include it. Start the day at 3R. And they let the market take out. Everything is preparing the squeeze. Yeah.

So all those red orders here are right now underwater. We take that high, we should squeeze up.

You are getting good.

Teach being prepared. We have a great.

What can we expect? Buyer said the eye.

Yeah.

The auction got expensive. Now more expensive. They are willing to pay higher price for it. So absorbed. Absorbed. You can put in stop in profit if you want. I will not do it. Because the test here it's really probable to happen. Yeah.

But we took a really exponential move. You see almost zero drawdown.

Yeah.

Like from when we entered. There was zero to non drawdown. Like we enter in this candle. It continue again. Seller trying to step in.

In a parabolic move in this particular here. Now, is this now the level we would hope would hold?

Yes. Yeah. This if you want to be conservative.

The down there.

Yeah, down there. Because this is the protection level of the sellers. Why we saw this exponential move. Even someone will think we are expensive. Why? Because these sellers are closing position and this creating even more momentum.

Now again same situation. Sellers aggressive buyers that needs to decide if they want to protect this level and continue to be aggressive here.

Now we are reaching 22 round number. Yes. This is a really important number. Price will accumulate or distribute around this level. So you can also decide to. If it breaks this high.

With aggression, you can also take the second position with a really tight stop loss. So if it goes bad, you take another $600 or $700. But at least you are protecting yourself. So if we tap this eye, the stop loss goes here.

Yeah. So our stop loss, our stop loss goes here.

So we make more than the first position, but still we are protected. Yes. And then someone can say what if it goes. If it tests and then goes up. Okay, we are protected on the second one. It's another $700 here. Because if this eye doesn't hold the market. Market collapse. I don't want to give back to the market all the profit that we made. We made an amazing zero drawdown entry.

Here because this is in consideration that that's our target. So then the it's a negative risk to reward so. Yeah, exactly.

Exactly. I'm not willing to give to the market all this money back.

Yeah.

And see our sellers are starting to participate on the top. I don't like it. I expect a squeeze that will bring us to target. But if it this, this level gets broken I, I, I have too much profit to give back to the it's not worth for me.

So our stop loss now it's. I will show you this low. Yeah. Okay. And I can see that it's not easy to break this high because you have to consider that it's a round number. Buyers are getting aggressive again buying the top.

If this auction fail I think we will revisit the lower low volume node.

All the way.

Yeah. Yeah, all the way. So we can have another position with mid 400 on the first 700 or 600 on the second. We are floating out. Yep, totally out on the position.

Let's remove everything.

It's important to highlight as well. So at this point maybe roughly a thousand dollars. Eleven hundred dollars in terms in total profit.

Yeah.

And bear in mind because I think social media causes a slight problem in the trading space where they think 1100 is not a lot of money. Bear in mind that's 1100 in roughly about half an hour.

With one contract.

With one contract. But not even just that though even 1100 in a single day is incredible because if you're trading for a month and on average you whatever 50% win rate, whatever it may be, you're still coming out with a very good yearly salary in a month almost.

Yes. Right.

And that's incredible. And that's like position number one. That's like as you scale in your trading journey, that's how it should look. Now I know it's so easy with social media to assume you need to be making a hundred thousand dollars a month every single month or multiple hundreds of thousands. And that is possible. Right. And there are traders doing that but they didn't start that way. They go through the process step by step.

Look at the precision of the reversal point. We saved all this money that the market want to give to get back like from here. This is I want to show you something. And they will make another prediction that is not a trade but is where the market will reverse.

This Delta from here to here it's not worth the trade.

Yeah.

Because here it's full of big trades not having a follow up. I expect that from here we get all the way back from here and we can use these two five hundred trades to make another one to three. Now let's say if we take another two trades for the day one to three five hundred series is another three thousand dollar only using the profit. Worst case scenario, we close break even.

The reason traders are unprofitable is they try to get the home run. So maybe they get this breakout and they all till the top without taking partial. Without. You can never go broke by taking partial. Yeah. Like you, you are sitting on profit for the day.

And in this case as well, like there's nothing in between that you would look for. You would only wait for price to come back to that higher probable area.

Let's see. I will exactly tell you where I expect a reaction considering that still the momentum buy. I didn't saw the big picture but the momentum by is amazing. But let's get the the whole picture.

Incredible though because it shows you when you're dissecting price, when you're locked in.

I lose the conception of time.

Yeah.

I, I was thinking that it was 20 minutes that we were there.

It did feel to be fair to you. It did feel like that. Yeah.

This is a huge volume. Huge.

Yeah. You can see like it's a squeeze. It's very. So I will not engage in other trades here. Just the first trade that I will watch is here. But watching the momentum I don't think we will go back. So you can just continue to adapt to the position using the profit if you want we can continue to see. It can go on one minute and see what big boys are doing.

So my take, and this is against the probability is that this is a wall. Okay. Okay. So this is the trade that you never need to do. But if I need to consider a trade.

This is what I'm afraid about. Okay.

Of that happen.

This is the reason I took out the buy position before. Gotcha. Round number seller getting aggressive buyers not having a follow through.

Was there any of this lowdown as well? Does that take that into account as well?

Yes, because this one it's compression again. The market getting back inside compression. Usually it's a visit of the law. Okay, now let's see what cumulative volume delta is saying. This is an important information that we are putting in for the first time here. And this.

The cumulative volume pressure of the market.

Visualizing candlestick you see that it's short down here. Yeah. This is an information because the SQUIDS was supported. But then we started to distribute.

Yes.

Again all this buy movement, no follow up. Yeah.

Your divergence.

This divergence is significant because it means that there is something big here. So two scenario. Either it breaks and we take another continuation trades. That is amazing for us.

But I know this asset and I think that we are going to revisit from here either this low or this low volume node. Then we take even better trades.

Yeah.

This is a pattern that I have seen a lot of times. Four consecutive weeks, every week. Taking out the high but not creating new value. If there is a big buy trades here a collapses soon. Of course it's not a trade because we are counter trend on it.

Let's see if this doesn't get old. I'll tell you that.

Yes. Yes. It's this one. Big trades, no follow through.

Yeah.

Sellers building the narrative cumulative volume delta going down. Here we go.

Would you say do you only trade nasdaq, nq, nasdaq?

Because it's a lot of information to deal with. Yeah. I tried one time with NASDAQ and crude oil but I was trying the therapist. Yeah. I need a psychologist at the end of the day.

But would you say that also that. That even though. Yes. It's a lot of information by really tuning into one asset such as nq.

Yeah. It's the. The cheat code.

Yeah. Like understanding just like you just said. I've seen. I know this pair.

This was feeling like this one is the intuition part. It's a counter time trades. I will never take it. But we took from the bottom to the high and we exit at the top.

Yeah.

We saved the delta profit that was here that if I was using my ego I will say no, we go to target because this is my target. But this capacity to adapt to market behavior here in this amount of error we took an explosion that is five times more. It's not easy to time the market in this way. If these big trades protect and break the high, we have another buy so we can again jump on the train.

And the problem with if you're trying to say long and then short is that that the real bias is still long. But let's say if this comes up now and you get break even or stop loss.

Yes.

A lot of people's psychology is that they will still focus on the short because that's the one they lost.

Yes.

Instead of realizing where the original bias is by taking this low quality setup like. Yeah. Okay. Might be. Might pull through. You might be able to make some good profit from wherever it may be. The problem is our mindsets get fixed on that bias then. And that happens to a lot of people. I think a lot of people. Let's say coming into this session as a good example. Coming into this session they did the same market analysis you did. Long bias, price shot down. They switch to short, they take a loss.

Yes.

But then the problem is they don't switch back or recognize their mistake and they stick on the loss and they stick on the short and they keep trying to short all the way up.

They marry their trades and then they.

End up in, you know, blowing their challenge, blowing their account, taking a heavier loss than they're meant to when in reality they have to. You know, you've done your. It's like you said earlier, right. When you're at war, you don't make the changes.

You don't make change when you are fighting. Yeah. Like the changes are made in the tent with generals and planning the war.

Up front.

In this case, it's building a goodbye setup. Yeah. Huge amount of buy here.

Watching the narrative here. I don't think we will retrace bet. Look where it opting low volume node. Now what we need to be back in the trade, we need a breakout of this high. Yep. So the next setup.

No, I want a full candle close. Okay. On this one.

So what's the reason for that one? Because we're already quite high.

Because the bias is clear. The bias is clear. The target is, is still not taken. The momentum is big and the interesting is big. Like this candle. This.

Big order is bigger than all this area. Okay. These traders are getting squeezed. So if we break this high, we test this area. I will Target for another $102,000 trade.

Getting to.

22062. This will be the trade.

But you see how much fast you need to put your ego aside and say this was the narrative that I was building. It didn't break the high but it break the low. Yeah. So it can be still a retracement to the leveling node. What I need the trade is valid as soon as we close with 1 minute candle, full body candle.

Above this.

Where we were failing.

Yeah, where we were failing. Even better. If in the move up there is a big trade cell that gets destroyed like here.

Let's see.

And how long have you been trading this way?

This way? It's around four years. That I use order flow more than price action before I started before four years. I Started to get only the trigger from order flow. Now I'm full order flow. Like I use price action only as a proxy and a result of volume. Yeah like I. You see I always compare the volume with the result that is providing and but the learning curve is still like 20% of what you can understand with this. So I still am 1 20% of the real power of order flow. I mastered. Like I still need to to get better sometimes because I think there are especially nowadays with machine learning and neural network you can put this kind of data in an algorithm that really helps you to remove all the noise. And I think in the era of artificial intelligence, understanding deeply this data and using AI to just get a better risk management or position management journaling all your trades. This is an idea for Umar. Like using artificial intelligence for the journal is something that can really step up the game a lot. And it's incredible how much when you have 2500 sample. Also a small change in risk management change the curve of the equity line. Yeah. Like you can go parabolic or you can go stable or you can go like this small change. So the strategy, it's 30%. Let's say 33%. 33% is the mindset the trader that is behind and that it can stay calm when it's not is set up or playbook presenting. Yeah. The other 33% is the risk management part. It's a huge part. Definitely.

Yeah. That's something that I did a round table with, you know, verified seven and eight figure trader Zuma was there as well. And that was one thing that seemed to stand out is that once traders had gotten the strategy down right, had their playbook and then they have the psychology at this point they have consistency. A huge portion of that change in P and L is tweaking the risk management like really mastering and focusing on that.

Totally.

So what are you seeing here then? So at this stage, obviously we've seen this big buyer.

We are, we are still in a buy narrative.

Is that that setup that you have mapped out, they're still valid?

The sell. The.

The buy.

Sorry, the buy is still valid. Yes, totally. And is still not activated because they need to break the hand.

Exactly.

Yeah. But it's valid. The narrative is valid. I was interested in this buy. If it gets broken and tested, we will keep this narrative. Yeah, but still we are long. We broke the high of the consolidation. So we are in the expansion phase that we explained before at this stage.

Where we are now anyway. I know obviously it's still valid anyway. But If I say you saw some sellers try to step in and they get absorbed and that just add to the confidence.

If I see sellers like getting absorbed here, it would be amazing because it says look, we are also heavy on limit order. Not only aggressive orders because these are execution. But if you see a sell aggressive, not getting a follow through, it means that the buyers are also protecting from limit order absorbing. So you have two forces pushing in the same direction. And so really good trades. I'm really optimistic on this one. Like it's a long way to go up here. But still we are in the dealing range that we want to trade because we still didn't took out the previous day, previous daily high. Yeah.

And would you say as well this compression we're seeing at this high, if we were to break higher, it would essentially be another squeeze. So because of that range that we've kind of been building here at the high. Yeah. If we were to break higher it would be all the, these sellers and these sellers here would have to close and there's. I think there's one in there as well.

Yeah.

But then they would essentially have to close out which would then cause us to push towards target more.

They will get an exponential move of the price here, I'm pretty sure about it. But we need to need to give them a reason to close the trades because still now they can be right. Yes, yes. They are going to be proven wrong if we first break this level. But if we approach this ice before. So I don't want to lose the trade because if I wait here to step in.

Yeah.

I risk that it's another explosion like this and we are unfilled. Yes. So I will just take a level because when we break this one, the probability that we will continue with psi. So our margin of error is small because we are only losing $595. This is half of the profit that we already made. Yes. But if it goes good, we add another 1200. So we are sitting on the day for 2230.

Just to confirm for everyone, we're not in this trade yet.

Yeah. No, no, no. When you see this level here, it's long one contract, the price takes that low.

Does that you can valid?

Okay. Yes. Because it means that the seller, these buyers are not aggressive enough to push it up. But I show you something I need to remove because the narrative that I have is really clear on the long and they will explain you why.

Let's consider all this compression here. Let's take into account all this area. Okay. Yeah. We are are not willing to break.

The load. Right. The value area low. But we are willing to sit above the poc. Yeah. If we are sitting above the POC consistently, it means that it's an accumulation. Yeah. Not always. But statistically wise it's more probable that we will approach this high. Yeah. And if we approach this eye and we spike up, these traders are forced to close their position. If they are forced to close the position, we experience another catalyst in price that gives us the possibility to be break even in one minute. Because we enter here, it approach here, it explode here, break even. So it's only temporary the $600 loss. Now I want to. I want to see if approaching here we have aggressive sellers not willing to.

Not willing to have a reaction like pushing. But limit order are absorbing them. Let's see how is it going. I want to activate also because it's really useful the cumulative volume delta in this situation.

So what the cumulative volume delta is saying now is that they are building momentum down. So we can expect what is called a whipsaw.

Okay.

Take off the law. But as you can see also here, consolidation like also here. Like it's replicating the same scenario in this situation here. Let's see. They say that scalpers don't have patience, but a lot. It's not like swing, but it's a lot of patient to wait for the correct setup.

Exactly. Yeah, that's true.

So.

I will only use these two signal. The value area low. And I will use the same color blue.

And the value area high.

That is this one.

Okay. Then.

I will cancel this one with a little bit of delay for connection, I think.

And what we will do is we will observe when we approach this level, if we approach this level, the behavior of the big trades.

Still not participating, still bias control.

Does this just mean.

No, no, it's live. Just I think. Let me reload. But I think it works properly. Okay. Let's see if there is any change.

Night words. Let me check with the phone.

If there is any discrepancy in price. But I think no.

Oh no, it disappeared. It was only temporary. There was delay 5 seconds, 10 seconds. The red mark. But we are approaching the high.

Still buyers controlling like if we want to get. The horizontal level is exactly the one protecting this order. So my stop loss is a little bit too generous. Should be like this, to be honest.

Exactly. $500.

This price consolidating the way it is right now is that. Would you say that's a positive thing, negative thing or just neutral it's positive.

Thing because it's most probably a reaccumulation before because the market cannot look here it's kyrot up. Yep. Without retracing. This is not efficient market exchange. If this is inefficiency price action. Gotcha. So this one is necessary if we want to reach the top of the day. This one is necessary. The market cannot be parabolic. Yeah. Because there needs to be interaction like sellers trying to step in. And now if we analyze sellers trapped buyers aggressive big node on the top. Possible squeeze. If we break this one. This one are forced to close. It's a good setup. This one is a good setup. And the good part is that we are using profit. Half of the profit. This is psychologically also really convenient for us.

So you have a 2% limit on.

Loss loss for the day. On the worst case scenario I lose 2%. That is eight trades.

Yeah.

But doesn't happen often.

Yeah.

Can happen one time every two months.

Yeah.

Yeah.

So in. In this case though like if you were trading at your own desk right now. And so first trades a a win. Are you taking trades like this trades. Another trade for example. Would you be taking any of those other trades that we discussed as well or trying them or is it.

I will take the exact same trade. It was a dex. The the only difference is that I'm with a track pad now and I have a mouse that have shortcuts. So I can just execute faster and also put that break even with one shortcut. Like the execution. It seems really important. Like with a laptop it's not the best to do sculpting. But yes. These are two valid setup. The setup that we took before is exactly what I would execute in the watering cup if I was still participating in it. We are approaching the high and.

Exactly at the level I told you.

So now participating.

We are waiting for full candle because it can be a fake out on the full candle we are in. It's one minute chart. So it's really easy. See if we were in before we would risk the whip.

So yeah.

Now what happens if the full candle arrives here? We cannot have this big stop loss. So we will just cover ourselves below the big trade. Okay. So let's see how it goes.

We are still not in.

I need to adapt my stop loss.

If the candle close even here we are still risking even less.355 but I need to see that it close above this box. Yes. If it close inside. I'm not engaging.

If it closes inside then closes above the box.

You're in or it close below. So not in. Okay.

But if it now closed above.

You see why not?

Yeah.

If it now close above, I still can consider the trade. But I need to cover myself below these buyers. Yes.

So this is potential area accumulation. So I can have a really small stop loss. It's this trade execute. I will participate here. It's $275 loss.

Okay.

20% of what we got for the day.

Are you doing that? Because that is if we go below that low, the setup is essentially anymore.

Okay.

So it doesn't matter about. Oh, you have $600 worth of risk. You could use to give it wider wing one contract.

But if the risk it's only 280$. I can scaling contract like I can bring the risk to 500. So two contracts in this case.

I got you.

Yes.

Okay, I understand. Yeah.

Let's see. Okay. We are in here. Close of the candle. We are in. We are risking $260 to make potential.

1100 is 1-2-5115 and a half. Ish. Yeah. The good part is that when we approach this, if we break we are risk free immediately.

If we break that.

Yeah, we break this one. You see the catalyst.

Okay.

We go risk free.

Got you.

And like some seconds and we go risk free.

So now you'd be risk free.

Yes. The risk free it's.

It can be below this aggression candle. But it's still risky. I will still not go risk free. Because I think we will test this level. I will take the risk to take a loss on this one.

Yeah.

You can go risk free when you see candle accepting the high.

Yeah.

This one is still not accepting the eye. And the risk is that if it test then skyrocket up and you are out of your position.

It moves too fast.

Now it's again test.

You see what I saved this the upper.

Top of the range.

Yeah.

Yeah.

I saved the fact that I will get liquidated if I go too fast risk free. And you can say you can re enter. Yes. But what if now it explodes?

It's too fast.

Yes, it's too fast. Now when we get a full money candle up, we can get risk free.

Okay.

You're getting anxious.

Yeah, we're giant. We're getting good. By the end of this be a whole different trader.

That's.

But be honest. Is it more clear than price action?

Yeah, it is. Is.

Way more clear. Like I said, the one of the most clearest order flow breakdowns we've done so far for sure. And to be able to do it Live as well and see it live is incredible. And I'd say that, you know, the platform's been incredible as well because as I said previous ones I've seen, it's. It feels very overwhelming. As someone who doesn't use order flow. While this one, you can incorporate a lot of this information quite cleanly. Especially like you had the volume profile with the delta and then you have the orders being shown as well, the large orders being shown, and it all feels quite clean. And the beauty is you can just click a button, hide them off, put them back on.

Yeah.

So you see, it's not. It's a. This is a failed auction. Like every time it approach the high and get back our probability that we will get a stop loss gets higher.

Okay.

So if we approach again and it gives me the ability to put my stop loss to break even even here I will do. Because the setup is getting the more, the weaker, the weaker the weaker. A good setup create an explosion here. Okay. So yes, there are these big orders protecting, but the probability that it will just spike out and liquidate me, it's getting higher and higher.

And that's exactly what happened. So how much we lost on this one? $255.

So the ability to be able to spot this here saves you to put a stop loss like the beginning we wanted to do here.

Down here. Yeah. No, it's a half the risk.

Let's adapt the narrative. We are in profit of 750 for the day because we lost $250 on this one. What can we do if this big order gets again absorbed? We can engage, but we need to see again aggression of the market participants. We can take a final position of other $500 to target for either the eye of the day, either one to two. One, two, three. Risk to reward. What happened here? Why we have this movement? Aggressive buyers no follow through. Getting back in sellers locking the movement. Now either we go here, either the buyers take control. From what I'm seeing, we go here. Why aggressive buyers no follow up. Yep. Like if you want this can be a short, but it's against the.

The bias.

The bias. So we will not experience it and we will not try it. So we are waiting that the market gives us a new long position.

That of course is not providing at the moment.

So what you need to see price close back above any certain level before looking sex.

I will show you also which level. Now.

The consolidation era is still the same. Okay, let's remove for a second the big trades.

And let's go on what really matters? Did it break the value area low? No. Did it break the value area high? Yes. Okay, first information. Now sellers are getting really aggressive here. What does it mean? Like before, before skyrocketing the market up, it took the low.

Okay. So either this candle is full of aggressive sellers, there is a big ball here. Either we go back here and I see market activity participant buy and I engage. Either we use the trend following setup only when it closed the candle here. You remember break testing here like we did here. This explosion was taken thanks to this. Okay, so we took a stop loss here. We don't want to engage in the noise now. Yeah, just want to be patient about it. Let's see what.

Because otherwise let's say, you know, we get involved now, we could easily continue lower or even if we. Even if we close above this, the the top of the range there could still go lower. While if we break above then we.

Could have a highly probably low probability that you will go lower. And also consider that if it breaks higher, you have a really clear level where to cover yourself. So you either you are right, either you are wrong. Really Fine. Past here, you can try along here. Get stopped out, try again here. Get stopped out here. If it breaks and it comes back is not valid anymore. Yeah, you cannot get stopped out for no reason.

So this could, you know, going back to your analogy as well about you know, during the battle. This is essentially like during the battle here where we entered the trade that we just got stopped down was when we had exited the battle. Then it ended up being a loss. That's fine. Yes, it's power trading. But now we're in the battle again. So we're not looking to make a decision now. No, we want to come away from it.

Exactly.

But it's planned ahead of time.

Yes. Now at the moment sellers are willing this battle. If sellers are willing to win this battle. This one needs to close. If this one needs to close, then we'll squeeze down. We will do the opposite. We'll squeeze down. See aggressive sellers here jumping back, liquidating all these ones. And from here we can get the big buy movement of the day. Yeah, let's see how it behaves. Still didn't took the law. The squeeze happens when you took the law here and they have 1, 2, 3, 4, 5 law to revisit. Let's see how they will behave.

Would you say usually what time will we into the open Where? Couple hours, you know.

Yes, couple hours in the open at this stage.

Normally is there more volatility would you.

Say or is this not like it's you seek compression day first movement, we made profit.

Yeah.

Then we lost in compression. As I told you, the model don't work properly when there is compression. Why we are still in profit. If we took one take profit and one loss for only one reason. Our risk management. Yeah, we took profit when it's necessary. We are wrong. When we are wrong, we are wrong immediately. You see the squeeze like took the first low, accelerated to the second. If accelerate to the second, it accelerate to the third. Big liquidation fill the low volume node. Market makers don't like when the exchange is not transaction properly. They don't like to leave void here. Okay. So you can see them from the low volume node. And usually they get filled. So this cell, if we were ignoring all of this, this cell is saying sellers are getting aggressive, but they are not having a follow through. Yeah, but in this situation we are also having a filled auction. If here we have a breakout of the candle and we get back here, this could be a trade. Yeah, it's not the situation because also the buyers are not willing. So we are in the situation. If you remember of the London session that we saw, not clear direction, not clear breakout. Long term bias is clear, is long long, but not a good setup to take. Yeah, let's remove the big trades here.

Let's watch what's happened. So they took the first two lows, they get back inside in the sellers are still aggressive here. We didn't reach the value area low and we failed the auction here. Now let's clean everything. If we clean everything, we see something really clear.

This failed auction. But at the same time. And I need to go on five minutes to show you this.

The bias is clear. But look at this, this situation.

They didn't even revisit from the first trade that we took the balance area.

So what can we do now?

We can use the full impulse.

To time.

The delta.

And what we see, we go deep inside.

The BI delta that is more relevant is concentrated here in this 3.1, 2 and 3. These are the biggest one, even if it's a void. And this coherent with the test of this. Now if we get back here, we have aggressive buyers, we have sellers that are in deep loss that can close the position and skyrocket up. So from this situation I expect that short term the bias is still long. We can accelerate and is exactly what we are doing.

So now it's time to take some of those previous lows that you mentioned.

We are going to take them. It's not worthy to take along here against the momentum. Yeah.

The narrative is really clear. The squeeze is happening. They took the first three low. They are going to target this other one. When they do it, they rebalance the low volume node. When they rebalance the low volume node, we have our opportunity to take a $500 trade to 2000 profit. 3000 profit for the day.

And we are done.

Let's see. Now we can know that it's.

Moving.

You see really aggressive. Accelerating to our fully accepted.

Now. I will never dream about putting the buy here without seeing some absorption or some aggressive buyer stepping in like I will before. Wait. This one is a continuation model. Like sellers, aggressive buyers trying.

You want them to fail.

You want them like it's accelerating, still pushing low.

When it's yellow, it's irrelevant. Like it's not relevant volume.

Okay.

So it's below the threshold.

Okay.

You can point it out. I think we are going to. Yes. We are going to push it out till this.

If these traders close, the position skyrocket up. We are experienced the first time that we are seeing this now.

Yeah.

What reads can. Can we take here If.

Let me show you. This is the candle that incorporated all this cell volume inside. If they manage to break the high of this candle. Okay. And get back in.

Not even if I calculated on purpose $500 risk.

We can shoot up.

To $2,000 trade. It's a 1 to 4 risk to reward. We will see later if it is still what we need to have to activate this setup. Break out with full body candle of this high. Okay.

So you need close.

I need close, yes. Okay. So if the market goes down. Great. Other aggressive sell. I recalibrate my stop loss.

Let's see what it does.

Still I expect a whipsaw down. Why the buyers follow through is garbage.

Yes. Yeah.

Yeah. The sellers. Yes, the sellers can push all up closing this position. But the reaction of the buyers is not so good. If we start to go above here, the sellers will be forced to close. This can be a catalyst for up. But I would like to see that we reach this low volume node. This is really interesting. Let's see if we manage to get it.

Just so you know, you hold the record for the longest chart for next episode.

Really?

That's right. Probably approaching four or five hours I think by now.

Really? It's a course.

It's not a. Yeah, exactly. Exactly. We told the people free education, you know, that you've never seen before. And yeah, we like to deliver and you've helped us to do that.

That.

Like I said, I'm excited to see the feedback. The comments from everyone. Interesting, Interesting.

Ultra aggressive sellers getting absorbed close to the low volume node. So this trade is not valid. Okay. We are canceling it.

Now. This low volume node is created by this candle. Let try to create a new low. But it failed to do it. So I expect that if we approach again this low, we have the final drive.

When the bubbles present themselves on the chart. Is that when the execution has taken?

Yes.

Okay, so you expect especially for that size, you would expect price when it's happened to instantly move. Really? Yeah. So the fact it doesn't is where we're saying absorption.

Yes, exactly. Okay.

Because if we look back here, for example, those buys came in, we moved.

Yes. Yeah.

Same here. The sells came in, we didn't move. But the buys came in, we moved.

Yes. They. They are facilitated in moving the the market. We are. What about now? What is your we are getting ready for? I need only the lock in of.

Green here.

We are approaching the level. So I'm waiting.

You still need that close above?

Yes, this is exactly $500. Let's put for now at 1000. Let's see the close.

The close is there.

Not yet. It's a one minute candle.

You needed to close the bot.

Yeah, it can close also below this one. If it close. The important is that it close below this, above this and above this. So still not doing it. You see it's rejecting. Okay, this one is not. Okay, still not in the trade. Gotcha.

Thanks God. Still not in the trade. Because as soon as the sellers are not are still protecting the position. You will see the retracement.

How often do you see like early buyers, early sellers. As in the traps essentially. Or like. Okay, getting in buyers early here for example. But then we go to that low volume. Yeah, A lot of times happen a lot.

Yes.

That's why that confirmation is so important.

Yeah, it's like a semaphore. Like if it's red and you are trying to pass two times out of 10 it's working. But the other time you are crashing another car. Like.

Yeah.

Now it's again presenting the setups.

But you need it to close.

I need to close. But I think we are almost there.

Let's see. Yes. Ghost. Okay. We are in.

Just tested.

So we got filled. Now we can decide to scale 1 to 2 at 1000 and then scale the final position out of the top of the day. If we take a stop loss on this one, we will close the day because the model is not responding properly because we are in consolidation phase. You see, we are whips on. Whips on. So we protect the profit that we made for the day.

Yeah.

Now I like these setups because they are usually zero drawdown. Like we are getting the whip so up. We are loaded here. When can we put this position to break even? Break design we have risked.

Yeah, yeah.

Let's see how it goes. You notice something about the really good setups that they go immediately in profit. That's the reason this one I decided to close only with $250 loss. Because if it fail to option high, you are going to stop us. There is no way you will win a trade like this.

So we are in line with bias. We have aggressive sellers stopped absorbed. Not tapping directly on the low volume node, but on the same level where the sellers get. Get absorbed before. Yeah, Bias is there.

Let's see if they reach at least the close. No, because it was overlapped with this one.

Imagine now they spike down, close this one and Skype this.

That happens, right?

Yeah. This will not surprise me. NASDAQ a lot of time does double legs with multiple spikes before jumping. But the good part about Nasdaq that now is not a good day. Like we are managing to make profit, but this is the worst day that you can have.

Yeah.

Because usually when it's building momentum is trend following. This one is breakout whip. So breakout. If we.

If we run in this same right now where we're trying to obviously trade live and continue to trade. If you are home and you took that first trade and you see this, would you then okay, it's a day for me.

Or would you say when I see that this model fails, goes back and I take profit from this one, probably I will just take another thousand profit and close for the day. Because it's not the market environment that is making me money. Yeah. Like I want to go more aggressive. When it's like London session was really nice. You see directional move. A lot of volatility in explosion. Like fast 1, 2, 3 setups now is getting like also for price action trader is getting really compressed. Yeah. Like all this area is not making anything. Just breaking, going down, breaking, going down. So now we have two scenario. Either we get another 1,000 the profit it and we close at 1,750 or we just get at least to break even. This one when we break this high and we let it run. Yeah, if you let it run. Each contract that we open on this one.

Would give us. Let's go to the top of the day.

For each contract we are making 3680.

So sometimes it's worth it to do it. Because if you get three or four contract you can make five figures per day.

Yeah.

But the win rate gets lower. So you can have these amazing days. If you are heavy on the lot size like me. I. I can open 5, 6, 7, 10 of mini contract. It's heavy if you get 10 contract there you can make 40,000$. But the win rate drops, drops down. I. This is just a personal like decision. I prefer a lot of days of 3,000, 5,000, 6,000, 2,000, 5,000, 8,000 and to build the five to six figures for the month. Yeah. Than having 40,000 minus three minus five minus four minus three minus. Because like this is not psychologically is not helping me.

You know.

And I think it's only ego because you can just take for example let's.

Say that you are sometimes what happens is it always balance. Sometimes it balances out anyway. Yeah. But one person hasn't had to take so many losses. Yeah. Which is as you say psychologically most people couldn't handle that. There are going to be those occasional psychopaths who can handle in the beginning.

Then I had one day where I was floating 28,000 for the day. I decided to keep for the I. It just reversed five tick below the eye and they lost everything plus stop loss on the next trades. So just. I say no, it's just stupid. Just you can close at 28,000. You are done for the week. What you need to do. Yeah.

So it's heavier from the psychology side. It's I will say also less profitable. But I don't know because I never try to keep my position open. But for example today you will be already into loss. If you keep the stop loss there. You don't trail, you don't manage. We would already taken three loss. We will not be sitting on a profit now soon we go to break even on this one. Because it's going really good. We got inside here on the test.

When we reach the high. Are you expecting a squeeze with these three?

Yes.

Okay.

That's the reason I I say I will bring to break even. Not close full position here. Because with the right squeeze it can go really fast to for example 2000. Okay. Can go really fast. So let's take as a reference that we bring to break even here.

Yeah.

But what we can expect is momentum now building for the day.

And when does your typically your session come to an end?

It depends like Some session. Consider that I'm living in United Arab Emirates. So I'm for me New York session is really late.

Yeah.

It's already seven.

Yeah.

So it's already seven. And usually I finish eight, nine, sometimes ten. And it's not just convenient to keep. So I do the first three to four hours of the session.

Yeah.

Yeah. And I just manage trades. But I don't decide not to take other trades. Now we have an opportunity to put our stop loss to break even already if this break again. This I not to break even. To stop. Not to break even. To break even if this high breaks. What the market is saying to us is that aggressive buyers are pushing sellers are trying to get aggressive fail. But they are getting failed. You know, I will not even say to break even but I will secure other $250 so putting stopping profits. So. So in the worst case scenario we close 1000$, and I'm still okay with it. You know, let's see if it approached the eye and get as much. Yes. So. Yes. Exactly $250 for the day. That brings back back like if we didn't took the previous loss.

Yeah.

And you see building slowly the profit for the day is not heavy mentally and is not giving us the risk that if now this is a failed auction that it explode lower we get another $500 loss.

Yeah.

Like getting consistent wins. Getting all your trading journal green. It's better than getting green on one day and red on all the other days.

What happens if. Is that what you would expect though if price was to come to this level to go continue lower down to.

Here considering that it's not breaking if it goes back here and it breaks. Yes. It will go at least to break even. Yeah. To the previous level where we end.

So then you might as well put it into profit.

Better be out. Better be out like securing some profit for the day and.

Be able to make 1000 in the worst market environment secure for you 5 or 10,000 when the condition are good. Like look at this market.

The only trending environment that we did is this one and we monetized it all the rest is is just managing your risk management and surviving this market condition. I decided to put that stop in profit here because this failed auction. Yeah. Says a lot about what the price want to do. Okay. Says a lot. So if we break this one we will collapse down and then you can say maybe we react here. Yes. We can try another trade. But sitting on a profit.

Yeah.

Like we can risk the profit. Yeah.

And if it does come down though to the low volume node, for example.

Then you have, then you, you can use half of the 1,000 that we make.

Yeah.

For, for, for it. But just I know Nasdaq and I know that after the huge gap that it made, usually the day is rebalanced. Yeah. Because.

Yeah, it's. It's a really not clear situation about Iran and they are just compressing. You see also the buyers are not getting any follow up. Up.

Yeah.

Like they are trying to push in the market high. But it was getting really aggressive by the sellers. We are still not out of the position. Let's see if this buyer can protect it.

Consider that the profit that we need today is made considering one contract execution.

Yeah.

So you need to multiply it for the amount of margin you have available to open 3, 4, 5 contract. We are out. We are 1000 in profit for the day. We are out. Now what we can do again is if this breaks the high, try.

The squeeze. Okay.

From here. But it needs to break the high.

In your close again.

Yes. Yeah. Squeeze the from here. Getting.

1000 of profit.

I think we can reach this easily if the price squeezed correctly. So now we are 1,000, another 1,000 per contract. Consider that with five contract available, you will close the day at 10,000.

Yeah.

People don't consider how much profit it is. But if you can do this in these days.

This candle close we are in.

You can also get a little bit more aggressive. For example, this one, it's 290 each contract. You can get your contract and get 600 risk to make other 2,000.

Yeah, yeah.

Now we are making all the trades with one contract. So I just consider one contract. We need to be with a candle out of this area.

Yeah.

For confirming trades. Still not.

Did you ever.

In the beginning, when, when looking at charts in this way, when price got above, just enter without the closure.

I. That's the reason now I'm so calm.

What would you say helped you to overcome that?

The equity line.

The equity line. You see this one is not accepting. It didn't close. Now this is the first candle that can close above.

And we need to adapt. Like if the candle for example is closing here, it's still valid. But we need to take other 100 of risk. Okay. So you just need the candle that close at the moment is not closing. And every time that you reject, as I told you, the setup gets weaker and weaker. So every time I get more demanding from my setup. So for example, now I expect for a breakout of this. So I need a breakout of this level, I will take still $385.

To target for.

I think what you said is right though in terms of the day. The day that we're trading today with obviously that large gap. That is a large gap as well. That's 3% of a gap that got reclaimed. And then we did have some decent movement after that reclaim as well In London. Right. As well as coming into New York. We had a very good move that we captured as well. So you know, in reality we could have this move, but we could also just chop and chop.

Yeah. Probably for the way this presenting like breaking the high of the consolidation and getting in this chop. It's a decision day and it's Monday. Yeah, it's really common.

Yeah. Monday that you.

It happens like Monday and Friday are my worst day in performance.

Yeah.

Because they are not explosion day. They are. I still make profit, but the profit factor is like way lower. But if it breaks that you see again, fake breakout, getting back inside. We are just not doing anything, just compressing. The only thing that I can expect is that if we approach this high, we see some acceleration. That's the reason I still say I can also take double the risk here and risk $700 if it goes in the worst case scenario, I'm still in profit for the day. Small profit, but I'm profitable for the day.

Yeah.

And if you take double the risk, it's another 2,000 that this will bring the day to 3,000. Now let's consider we take this trade and we close the day at 3000. We are using one contract. Okay, let's see. Also to contract is what you can do with 100,000. $100,000 account.

Yeah.

It's 3% in one day. People don't understand how much it is. If you can do this consistently, of course like the edge fund will be craving for you. Like we will be knocking on your door. It's a good accumulation. What is doing here? This is a good pattern. Taking the law rejecting on the big trades. This is really nice.

So really when it comes to the the big buyers and sellers. For example, if a seller stepped in right now, now, but no follow through, that's great for that narrative.

Yes.

If a buyer steps in right now with follow through, that's great for the narrative. What you don't want to see is a seller step in and it follows through. Or buyer follow fail.

Yes. If you are long. Yes. Yeah. Opposite if you are short. Like we were saying, see again, fake breakout multiple times. With the rules that I created that you need to see a full body candle above the eye. You are saving all these small stops.

Yeah.

Because you are not engaging. You are simply not engaging.

I told you NASDAQ is not uncommon that he will do this game.

If it got down there now though at this point in the session, would you still be interested in it or.

It will be an amazing trades but it means that I need to sacrifice time with, with my family and I need to not eat because I need to manage the trades. It's really late now for, for me I will take it but I will bring it to break even as soon as possible. And this is the only set and forget rates that I will do. And then.

Yeah.

Because of the size testing of this I go breakeven at the first big volume and then if it reached the ice or if I need to close it before the end of the day, I just don't care. Yeah. Just I need to be protected as soon as possible. But I need also to protect my mental health.

Yeah.

This is something that people are willing to sacrifice just to make additional 50 bucks per day or additional. I'm not willing to do it because I am already in a position where money it's not important for me and €1,000 plus per day doesn't change my life.

Yeah.

So I can decide when to engage and where not to engage. For example, now, now we are doing education but this day I will say 1000 it's enough. Tomorrow it's another day. Yeah. And I will wait for the explosion day. Like this is the goal of every trader. If you can make money or just close at breakeven in the days that your model is not working. So for example you have a min reverting day and you have a trending day. You close break even a small profit. You are great. Yeah. Same for trend following model.

Whilst we're waiting on this, if we could go down just out of curiosity and I'm sure there might be some who are might be thinking this or.

Asking this five minutes or one minute.

We stay one minute. If we come down to that level where we rebounded off.

Ah yes, this one.

Like there will be people no doubt thinking like why not? Why don't we try and execute there? Because that's going to give us such a larger trade.

Right.

I know we talked about it slightly earlier but like what would your, what would your opinion on that be?

Because this setup here is using the opposite logic that I'm using is using one big run with lower rate.

Yeah.

Like I can guarantee to you that if you watch nasdaq session opening.

7 times out of 10 if you try to get the aggression, you will fail. 3 times out of 10 you will be right and you will. You will take a huge risk to reward trades. But you have seven red days and.

Three green days and you don't know when they're presented.

If this is okay for you. Do it like volume is greater because he's saying that these sellers are getting absorbed. Just I tried this model and it's not for me. Like when you trade big size, getting seven days streak loss that you see minus 10,000, minus 5, minus 6. It's heavy. Go to sleep with this heaviness. It's for me it's not. I said before I was searching for the home run, you know, I was wanting to take you see it break the session. So this setup of getting the full candle, positioning yourself is not valid anymore.

This market condition is in reversing.

Yeah.

So just.

Going to revisit. And this should let people understand that taking out here is saving you money.

Yeah.

Like. And if we kept the trade till here, we didn't only not profit this $250, but we will also lose $500. So as you can see and we can demonstrate this risk management is if not more important at the same level.

Because keep in mind as well, that was with one contract. So if it was more, if it.

Was more, it was 7,500. If it was 10 more at the end of the month it count.

Now the we are completely compressing. Let's see if we accelerate a little bit to get to this final point.

If not, call it a day there because it's been incredible. If not, we've got to see everything there. We've got to see break even. We've got to see four hours. I know. Yeah.

Yeah. I think we will just close the day because it's full consolidation rates. Yeah. And we'll just check later how it went. If it closed the low volume node and went up.

Yeah. We'll get a screenshot or something going for sure. Everyone at home. Finally. Yeah, we come to the end. Drop a comment of your biggest takeaway from this episode. Did you enjoy the live trading segment? If so, drop it in the comments. Let the people know out there that they need to be doing live trading here on chart for Nikes as well. Obviously a massive shout out to Fabio because. Because it takes a lot. It wasn't planned. I didn't ask him. He offered to do this which is incredible and such incredible trading skill and you get to see it here live. What a true professional trader does, but also what a true professional playbook and strategy looks like. Really. But links for Fabio will be in the description below, so make sure you check that out right now. Hit subscribe. Hit like other episodes are on screen. We've been chart fanatics and until next time, take care.