Learn to read the Market with the 3-Day Cycle

Hey guys, I'm currently outdoors, so do pardon me if the audio is a little bit off, but I'd still like to just make this video while it's fresh on my mind on how I basically predicted, you know, this right here basically to a T. And it's a part of what I've been experimenting with recently with the quarterly theory, Stacy Burke stuff, and just pairing everything together. So essentially Oh, also, I, I pretty much predicted the top. If you take a look at here, uh, at 10:19, which is 9:19 PM— at 9:19 AM New York, I basically predicted that the move has 20 pips to go. And at 9:19, that's right there. So when price was sitting here at about 1.0707, I predicted that there would be 20 pips more to go at a minimum. Right there, the top comes in right around 20 pips later. So how did I predict all this? And yeah, it's basically what we're going to get into this video. Um, again, this is just a pretty preliminary video. I don't have slides, don't have nothing, but still just want to share this concept with you guys and at least start putting this concept in your mind so that— think of it as primer. So this is a combination of— actually, this is primarily Stacy Burke's technique. And for those of you who are not familiar with Stacy Burke, he basically talks a lot about this thing called a 3-day cycle where you have Well, the market always moves in 3. Uh, moves tend to happen in 3 days. Um, you know, for example, pumps and dumps happens in 3 phases. That's your first pump, second pump, third pump. When you dump, 1, 2, 3, right? And then when you pump, you know, it's like— you get the idea. Basically everything happens in 3s, especially in the markets. But in this video particularly, I want to talk about purely the 3-day cycle and give you guys— this 3-day cycle thing gives you such a cheat code because you You can use this alone to read exactly what the market is likely to do for the day. Will it close higher or will it close lower? Essentially, the 3-day cycle is a great tool to allow you to determine your daily bias, which some people struggle to do. And when I say daily bias, I simply mean the daily power of 3. Is the candle, is the daily candle going to close higher or is it going to close lower? And if you do not have that information, you cannot do anything in trading because are you supposed to buy below the daily open or are you supposed to sell above the daily open? You need to have the daily bias in order to be able to trade. Now, this method here will give you that ability to determine the daily bias. Now, this will be slightly complicated because it's not something that I could cover in just a single video, but I believe that I have enough of an understanding of, you know, the concepts to be able to distill it down to a more simple degree compared to Stacy Burke, which, uh, just say is not the best teacher. But again, I will try my best. And let's start with the concept of how do you determine what, like, what is, like, what constitutes a day 1? So what you wanna do is you wanna actually pull up this one, Spaceman BTC Backtest Levels. Now you can either use an indicator or you can just do it yourself, but basically that indicator basically marks out your previous daily high, which is right here, the green line, your previous daily low, which is the red line. And this right here, this black line is the daily open, right? So when the market opens, this is the price. Now these 3 levels are all you need in order to trade Stacy Burke's method. Everything else is just extra. It's just the cherry on top, basically. So let's start with, actually, let's start with breaking down the 3-day template. Now, I was actually gonna work on this earlier today, but I figured what better way to explain this to you than through a practical example where I've already proven that it works. So some characteristics of a 3-day, of day 1. Let's start with day 1. The way that you determine a day 1 is on a 15-minute candle, right? 15-minute chart. That's the higher timeframe that you use when you use Stacey Burke's method. The 15-minute is the higher timeframe and everything below that is your execution. So I'm talking 1-minute and the 5-minute chart. Usually I use the 5-minute chart. The 1-minute is a bit too quick for me and the 5-minute tends to work pretty, pretty well. However, Stacey does recommend, you know, using the 1-minute. However, I don't think that I'm at that level yet. Sometimes I use the 1-minute, most of the time I use the 5-minute and there's nothing wrong with that. So what constitutes a day 1, right? When do you restart the count and how do you know when is the day 1? Day 1 is basically when you Trade above, right? When you get a 15-minute candle closure, just one 15-minute candle closure above a previous daily high or below a previous daily low. So price trades above the previous daily high with a 15-minute candle closure. This already constitutes Monday, right? Look at this, this is Monday. Monday is already a day 1 in a day 3, in a 3-day cycle. So this is already day 1, okay? Similarly, yesterday on Wednesday, we also have reset the daily cycle. So Monday was day 1, Tuesday day 2, Wednesday is day 3. But then the fact that Wednesday trades Tuesday's low with a 15-minute candle closure indicates that now Wednesday has also restarted the day count, and Wednesday now becomes a day 1 in a 3-day cycle. So today, Thursday, is a day 2, and I'll get into how this plays into how I basically managed to predict this move in just a bit. And then tomorrow will be day 3. So that is all you need to understand on how to reset the day count. And then here's the second thing that you need to understand. Usually Day 1s or day 2s, right? And this is sort of like a separate concept from day 1, day 2, day 3. It is the concept of a first green day and a first red day. So let's start with a first red day. Basically, you get a first red day when price trades above the previous daily high and fails to close the day above the previous daily high. In fact, it's even more of a confirmation if like a first red day is when you trade above the previous daily high and but you close below the current day's Open, right? This is your open. Price trades above and you end the day below the open. This is a failed breakout. And failed breakouts are going to be super, super key for understanding. Now, it's a huge factor in understanding Stacy Berg's methodology. But for now, just remember that that's the first red day. The first green day is on the opposite side of the spectrum where you trade below a previous daily level, but you failed to close beneath, but you close actually above the current daily open. Right? So this was the daily open, price trades below, and then comes back up to close here. So you have 1, 2, 3 days of dump, and then now you have your first green day. Now the significance of a first red day and a first green day is that it indicates to you, number one, that the daily cycle— no, the 3-day cycle has reset. And number two, it's actually a reversal signal. And the reason why it's a reversal signal is because the fact that it's a failed breakout means that there are traders, breakout traders, right? And breakout traders basically include the majority of retail. The majority of retail trades breakouts, meaning when you break above a previous level, what do you do? You buy, right? Because it's a breakout. So there are— you have to understand the concept. And then now we come back to the concept of trapped volume. So when you have a lot of traders going long above this level and a lot of traders trying to go short beneath this level, and when price aggressively moves away from that level, now all of these traders are now trapped, right? They're long, they're trapped. If they didn't have a stop loss, well, they are about to get royally screwed. Same here when price pumps. By the way, this is also how yesterday in the Discord I also said that, you know, this is day 3 reversal, expect a reversal. You get a W pattern forming and I was like, yeah, it's going to go up. So how was I able to know that? Well, it's trapped volume, right? At any given point in the market, if you can identify where is the trapped volume, you're going to have a really good time trading. For example, we have today during the London session where you have a range here. The moment The London session began at about 2 AM, right? You broke lower, you came back up. That is your cue to go short because now you have trapped traders, right? But I was personally looking for a long trade today because today is a day 2 in a 3-day cycle, which leads me on to my next point. So day 1 is basically like you don't do anything unless you have a day 1, right? Day 2 is when you can start trading basically. Like you can trade day 1, like that's no problem as long as you can see it coming. But day 2 is will give you a much clearer signal because day 2 most often is considered a trending day, right? Day 2 trend. So if day 1 is a first green day, day 2 you expect the majority of the daily expansion, right? I'm talking expansion. Where is the market? Like what is the? So you know how I talk about market maker buy and sell programs when you are in a sell program? Well, obviously you make lower lows, lower highs. And also the significance of a sell program is that every buy side liquidity sweep. Right? Let's come back into this chart here. Every buy side liquidity sweep will lead to new lows. When you are in a buy program, every sell side liquidity sweep will lead to new highs. So the moment you get the first green day, that is your signal that perhaps day two is going to be a trend day, and also the trend day will be towards the upside. Again, this helps you narrow down the daily bias. So in this case, we have right here a fifteen minute you know fair value gap that I was looking at. which is where I made my prediction. And this is where the daily expansion, right? You target in a buy program, you target buy-side liquidity and sell-side liquidity fills or sweeps will lead to new high formations. Okay? So day 2, just have to remember that it is most often the case, a trend day, and it will follow the trend of day 1. Now, day 2 is, can sometimes be a reversal day. Doesn't happen quite as often, but that is outside of the premise of this video. I don't wanna make it too overwhelming. For now, learn to identify day 1 of a 3-day cycle, identify trading opportunities in the day 2 of a 3-day cycle. And now we get to day 3. Now, the characteristics of day 3 is that it can either be a parabolic trend trade, meaning it'll trade parabolically in towards the direction of the trend. So you can see that this was Friday. Friday was a day 3 in a 3-day cycle, parabolic trend trade, right? So over here, that's your Wednesday. What is the characteristics of a first green day? Well, you fail a breakout. Right? You fail a breakout beneath the previous daily low, and now traders are trapped here. What do you do? That's your first— that's your first green day, basically. And then day 2, trend trade, right? Trending. Day 3, what happens? Parabolic trend trade. Now, day 3 can also be a reversal. So Wednesday, in this case, was a reversal day. It was not a parabolic trend trade. Now, how do you determine that? Well, it all comes down to confluence. What do you think the— like, there are other factors at play here, And you pair the 3-day cycle, your knowledge of the 3-day cycle with other confluences. And that's how you are able to determine if it's going to be a reversal day or a trend day. So day 3, and so that's tomorrow, depending on how market structure plays out, you know, yeah, you just gotta remember like it's either a reversal or a trend. And it really depends on the way that you determine if it's going to be a reversal day or a trend day is actually down to 3 things: timings, levels, behavior of price. 3 things, okay? Timings, levels, behavior of price. Yesterday, And, and let me just break it down to you. I'm just going to give you like an example in this video. I'm not going to get too deep into it because I don't want you guys to get confused. But the way that I determined that this was going to be a reversal day for Wednesday, day 3, is because I used the knowledge of timings, levels, behavior, price. So remember earlier in the video I said that price always moves in, you know, like a 3-day— sorry, like a 3, you know, push sort of formation. So during the downtrend, you actually have, you know, technically 1 push, 2 push, and 3 pushes down. Now you can also break that down even further. So maybe the day starts here. So the moment the day opens, you have 1 push, 2 push, and maybe about 3 pushes down, right? And this is all prior to the New York session where you have news. Yesterday there was news that was happening at, I don't remember the exact time. In fact, we can check. So that's calendar. Yesterday was 9:15 AM. Right? So at 9:15 AM there was news. And you have to remember one other thing is that whenever there is red news— red news meaning red, right? These red news, these are high-impact news. And whenever there is red news, anything that happens before the news is just a play to set traders up so that the market makers can bring it in the true direction. So this downtrend here is just like— this is a classic dump and pump setup. Day 3 dump and pump. So today was a day 2 dump and pump also. Right. You need to manipulate traders into thinking that the market is going down in order to bring it up. And once you learn to spot this, you're going to get really good at this. So everything prior to the New York session, right? Notice how— and you can still trade like the London, that's no problem. But you just got to be aware that if there is a news day, that liquidity can be engineered. And so this leads me on to, yeah, going back to levels, right? So price during the day had 3 dumps, right? This is what Stacey likes to call 3 levels of dump. Or like 3 levels of fall, or actually I don't really know the proper term. And secondly, one of the other concepts that you must remember is that the false moves tend to have a magnitude of 25 to 50 pips for currency pairs. Usually for currencies, it's closer to 25. I've rarely seen a 50-pip, you know, stop hunt. So you can see that the moment the move started, it was, you were sitting at around 1.07. By the time the move ended, you were sitting at around 1.066. Right? So this is a false move, right? This is a stop hunt. Stop hunts and false moves/liquidity engineering moves tend to happen with a magnitude of 25 to 50 pips. This also means that, like, let's look at today as well. This was 1.07155, and the stop hunt actually went about 30 pips. This was about a 30-pip stop hunt to trick traders into thinking that the market's going down before you reverse it. Yeah. So start of today, the market has dropped about 40 pips. Towards the downside. And this brings me on to the second part. The moment it hit the previous daily low, you want to observe the behavior of price because now at this point there is a possibility for a failed breakout. It's also how I saw this, uh, Monday dump coming because here, right here, that the moment I saw like this dump here, let's be real, it was looking kind of like a failed breakout. So the moment you hit this previous level on a day 3, all right, you have to anticipate that perhaps there will be a failed breakout. Okay. And Whenever there is a failed breakout, there is always going to be trapped volume. Trapped volume will always come in the form of a little range. So that is behavior of price on a larger scale. Now we actually look at the behavior of price on a smaller scale. So before I get into the smaller scale behavior of price, I want to talk about timings, which is the 3rd confluence factor in this whole strategy. And without any one of these 3, you will not have a good time with this. It will not work. You will fail. Do not trade this without a good understanding of timings, levels, behavior of price. Now, for those of you who have watched my videos on, you know, like market profiling and stuff like that, you know that 8:30 AM New York tends to be a very high probability area. That is when the markets seem to come awake. And 8:30 AM is lying in Q2 of the quarterly theory in the New York morning session, which means that this is like— Q2 is basically manipulation, like the manipulation window. And 8:30 is prime time for the manipulation window. And I always look for my trades like 15 minutes before or 15 minutes after 8:30, usually. After. So 8:30, you get the liquidity sweep right here. And then now, behavior of price. What does price do immediately after? You get a strong displacement to the upside. And again, boom. The moment you get that change of character right there, very next candle retraces back into an order— sorry, a fair value gap. Whoops, that's not what I intended to do. That's your fair— it's not working for some reason. That is your fair value gap right there. And that is your cue to trade this for a day 3 parabolic reversal. So this moved from— this moved about a magnitude of 50 pips, all right? 50 pips, uh, basically within a couple of hours. And then the move ends before what time? 12 PM. I always talk about how you want to close your trade out before 12 PM. So that's day 3 today as well. From here you get a 50-pip move, which leads me on to how I predicted that this would be the top. Now most currency pairs— actually, I don't know most currency pairs. I've only ever traded the euro and the GBP, so I don't have an immense breath of knowledge, but I do know that, uh, based on my understanding of the Forex markets, while it may be limited, that the daily range for currency pairs rarely goes above 50 pips, right? If you do go above 50 pips, like, it's a good day. For example, last Friday, that was amazing. I think you basically went 100 pips. Yep. Yeah, more than 100 pips actually. That's a good day. This does not come around that often. Majority of the time, if it's a normal week, 50 pips is what you want to go for. So whenever you see from the start of the move to the end of the move, once you measure about roughly 50 pips and you see the behavior of price and the timings and the levels, they all add up and you think you should be closing it, that's when you should be closing it. Take your profit, run. And this is the whole premise behind Stacey Burke's Free Cash Wednesdays, Free Cash Fridays. Like, free cash means you wanna take your profit, okay? 50 pips and you're out. 40 pips, you're out. Even 30 pips, depending on how much size you put on. Like, even if you just go 1 lot, 30 pips is already $300. And if you go anywhere— wait, 30 pips? Yeah, 30 pips is already like $300. And if you go anywhere above, you know, 1 lot, you know, 30 pips is quite a bit of money. And if you manage to catch the whole 50-pip move, which I've done, you know, on a couple of occasions, more than a couple of occasions actually, using this method, yeah, you're just, you're gonna have like a very big winner, especially if you put size behind it. And yeah, guys, key takeaways from this video. Start like Do not get overwhelmed. I know there is a lot to this, but it's actually quite simple once you get the hang of it and once you understand it actually. And it is my job here to deliver this to you guys in an understandable, easy-to-consume fashion. And so key takeaways from this video. Remember, day 1, how do you determine day 1 of the cycle? You determine that by looking for false breakouts or simply a normal breakout. As long as you have a 15-minute candle closure above a previous daily high or a previous daily low, that is your day 1. So it does not have to be a failed breakout. It can also be a breakout, but that is your day 1. That is when you start your day count. Trapped volume. Whenever you see trapped volume above a previous daily high or below a previous daily low, and especially, especially, right? Especially, this is the golden tip. And it took me a while to understand this. You don't like the highest probability trapped volume trades that you are going to get is when it occurs at the current high of the week or below the current low of the week. So this is your current high of the week, right? On Monday, new week. Well, duh, this is your current high of the week. If you get a failed breakout at the current high of the week, tends to be very, very high probability that the market will reverse the other way. If you get a failed breakout at the low of the week, right? Current low of the week. Now you'll hear Stacy Boat talk about this a lot, right? The high of day, low of week, hot low of day, hot low of week or whatever. What he really means, and he's lazy to do this, but what he really means is the high, the current high of the day, right? Just like how, you know, after a first green day, where do you want to look for longs? You want to look for longs at the current low of the day. Okay? You don't want to look for longs here. You want to look for longs at the current low of the day. You want to sort of anticipate this. But either way, that's day 1. Day 2, remember that most of the time it tends to be a trend trade. Sometimes it can be a reversal, and timings, levels, behaviors of price will give you the confluence that you need in order to confirm that. And day 3 can either be a parabolic trend trade or it can be a reversal. Again, timings, levels, behavior of price. Now, all you need to take away from this video and put into practice is learn, like, just spot them, right? Just spot day 1, day 2, day 3. Like, just learn how to count the days. You don't have to trade it. I just want you to go back into your chart and learn to spot it until it becomes almost second nature to you, where whatever happens on the chart, it's like, wow, okay, this actually works, and this actually kind of works like clockwork. So that's your task after this video. Just go back to any You can even do this on crypto, by the way. Like, I've only applied this to forex so far, but I'm very sure that this applies to crypto as well. And yeah, like, try it out. Let me know how it goes. Oh, also, one last thing. Day 1, day 2, day 3 does not need to occur— day 1 does not need to occur on Monday, okay? It can happen on, like, Tuesday. It can also happen on Wednesday, right? Day 1 does not necessarily mean it has to be Monday. Just want to look for a breakout, a 15-minute candle closure above a previous daily level. For now, what you need to understand is simply that, um, day 1, day 2, day 3— learn to spot it. And once the video on timings, levels, behavior, price comes out, this will add another layer of clarity to your understanding of these market maker templates, and you can just read them like clockwork. So yeah, if this video has been helpful, uh, let me know. If you have any questions at all— I know this is a new concept— let me know as well. I am always open to help. And yeah, bye-bye. Now, if you're at this point of the video and you're still watching, It's clear that you're someone who's serious about their improvement and serious about making trading work. If you've been struggling with making trading work for you, maybe it's a bit too complicated, there is way too much information, or maybe you can sort of see what's happening on the charts but you struggle to turn those ideas into proper trades with profits, or maybe you want to get started trading but you just don't really know where to start, then I'm here to tell you that Trading Ascension, which is my private mentorship takes on 8 students per month. And if you're interested in taking a proven step-by-step fast track to getting to $10K per month trading, or simply to make huge progress in your trading, then I invite you to click the link in the description box below, and I'll see you inside Trading Ascension. Bye-bye.