2022 ICT MENTORSHIP EPISODE 10

I M P L E M E N T I N G E C O N O M I C C A L E N D A R E V E N T S W I T H T H E O P E N
B R A V E H E A R T S T U D Y N O T E S
 Always consider the Economic Calendar for successful speculation.
Failure to do so will result in the market surprising you with unexpected volatility on your behalf.
ForexFactory's Economic Calendar is ICT's preferred choice although every other Economic Calendar available will complete the same task.

Red = High Impact Expected The focus should be on High Impact and Medium Impact News Events.

Orange = Medium Impact Expected Low Impact and Non-Economic News Events are less significant.

Yellow = Low Impact Expected

Make sure to adjust Economic Calendar Time-zone settings to EST.
Grey = Non-Economic
We use 8:30 AM due to the News Embargo Lifts that occur at the opening.
These reports released at 8:30 AM serve the purpose of being a smokescreen.
They will be utilized as an incentive to move the price up or down.

Smoke Screen:
A Cloud of Smoke Created to conceal Military Operations

Slang Term for Trading:

A smokescreen is intended to hide the truth about activities or intentions.
Before the release of a news event, the market will often build up a False Price Swing.

Then after the release, the real move will take place in the market which comes in the form of a Displacement.
Power of 3 Amplification + Daily Bias
For an introduction to Power of 3, please refer to these videos.
How to find Daily Bias step by step with the 3 B's.
B1. Based on what the market has previously done, what is the current Framework?

B2. Based on the current Framework, what's the next Draw on the Liquidity?

B3. Based on the current Dealing Range, is the Market in a Premium or Discount?
 B1. Based on what the market has previously done, what is the current Framework?
-Did the Market take out any Significant Liquidity Pools
-Did the Market hit a Significant FVG?
-Did the Market create a Market Structure Break with an Displacement?

You can use the same Model taught in 2022 ICT Mentorship to find Daily Bias.

This is because Price is Fractal.

What can be seen on a Monthly Chart, can be seen on a Daily Chart.
What can be seen on a Daily Chart, can be seen on a 5 Minute Chart.
 B2. Based on the current Framework, what's the next Draw on the Liquidity?
-Do we have clean lows or highs?
-Do we have FVG's that need to be rebalanced?

Avoid the temptation of picking bottoms and tops.

It's a situation that will cause more losses than you are willing to endure.
Retail Methods and teachings will give you false confidence that you are able to do it.

If you are wrong by following trend, the market will give you a chance to get in on the opposite side.

There should be NO FEAR in being wrong.

 B3. Based on the current Dealing Range, is the Market in a Premium or Discount?
Within that Dealing Range, find all the Reference Points such as FVG's
Moves that are counter-trend to the Draw on Liquidity are still permissible although they require more experience.
After asking yourself the 3 B's, you now have the decision to be Bearish or Bullish.
With that decision you are now going to be thinking with 2 Mindsets...

Daily Chart Mindset

Intra-day Mindset
 IF YOU ARE BEARISH
Daily Chart Mindset:
(On the DAILY CHART)
Every UP Candle (or multiple) should be considered a SELLING OPPORTUNITY.
You are then targeting Old Lows on the Daily Chart or Previous Days Lows.

Intra-day Mindset:
Expect a False Move above the Opening Price.
Smart Money will be selling into that False Move higher, to then bring it down lower into the close.
 IF YOU ARE BULLISH
Daily Chart Mindset:
(On the DAILY CHART)
Every DOWN Candle (or multiple) should be considered a BUYING OPPORTUNITY.
You are then targeting Old Highs on the Daily Chart or Previous Days Highs.

Intra-day Mindset:
Expect a False Move below the Opening Price.
Smart Money will be buying into that False Move lower, to then bring it up higher into the close.

Weekly Chart
FACTOR 1:
UNDERSTAND THE DIRECTION OF THE DAILY CHART.

FACTOR 2:
UNDERSTAND HOW A DAILY CANDLE FORMS WITH THE POWER OF 3.

COMBINE BOTH FACTORS, AND YOU ACHIEVE THE DAILY BIAS.

An entire Bullish Price Swing on a Daily Chart consists of both Up Close Days and Down Close Days...
Know that the majority of Daily Candles will be Up closed instead of Down closed.
Those Down Close Candles are used for New Buying to continue the Bullish Price Swing.

DO NOT LET THOSE DOWN CLOSE DAYS SWAY YOU LIKE A LEAF IN THE WIND.
An entire Bearish Price Swing on a Daily Chart consists of both Up Close Days and Down Close Days...
Know that the majority of Daily Candles will be Down closes instead of Up Closes.
Those Up Close Candles are used for New Selling to continue the Bearish Price Swing.

DO NOT LET THOSE UP CLOSE DAYS SWAY YOU LIKE A LEAF IN THE WIND.
 How to use Swing Points for Daily Bias and PO3
IF YOU ARE BEARISH
2
3
1
Stage 1:

1. You need a Swing High with a Bearish Context.

2. Study what occurred on the 3rd Candle Intra-day.

3. If the 3rd Candle Intra-day indicates a REVERSAL, expect the 4th Candle to be an Expansion lower.

If stage 1 is completed with a 4th candle expansion, continue to stage 2

How to use Swing Points for Daily Bias and PO3
IF YOU ARE BEARISH

Stage 2:
After a Swing High has been confirmed with a 4th candle close,
Price will most likely build another short-term premium before it has another expansion lower.

This is when you wait for Price to trade back into a Premium market relative to it's range.

Expect this too occur when Price hits a counter-trend level.

Price will either pause and consolidate, or retrace back into a Premium.
Stage 1 Example:
Stage 1 Example:
 REFER BACK TO EPISODE 5 NOTES
"MARKET PROFILES"

FOR MORE INSIGHT ON THAT 3RD CANDLE...

Stage 1 Example:
Stage 1 Example:
Stage 2 Example:

Remember this?
This is when Stage 2 comes in.
Why Though?
Study 4th Candle Intraday
 Stage 2 Example:

Do you see the Market Reversal Profile?

It also hits the Daily Level at the same time.
Stage 2 Example:
Stage 2 Example:
Stage 2 Example:
Stage 2 Example:
 You are sticking with your bias the whole time.

Refer back to page 28

An entire Bearish Price Swing on a Daily Chart consists of both Up Close Days and Down Close Days...

Know that the majority of Daily Candles will be Down closes instead of Up Closes.

Those Up Close Candles are used for New Selling to continue the Bullish Price Swing....

YOU ARE FOLLOWING IT'S PREMISE UNTIL THE DRAW OF LIQUIDITY YOU HAVE FRAMED HAS BEEN MET.
 Psychology for Daily Bias [From other notes]

Stick & Stay with Your Bias Only.

Execute only with that bias in mind.

If you are Bearish, only stick to shorting.
If you are Bullish, only stick to longing.
You do not have to capture the large moves, but rather work with your biased expectation so that you do not "flip
flop" back n forth between biases and confuse yourself!

Day Trading is NOT Everyday Trading.

You think you will be able to do this every day, but that is a misunderstanding...
Why?
You are falling in love with WINNING instead of being PROCESS-ORIENTATED.
Falling in love with "being correct" and "being better than the rest" is a trap.
The truth is it does not need to happen every day.
Find comfort in NOT taking trades.
Understand the potential risks in trading every day because of the markets being open.
You are too focused on the money.
Not every day will give you a high probability opportunity.
 Power of 3 consists of 3 Stages:
Accumulation, Manipulation and Distribution.

Bearish Example:

Accumulation Phase:
When price is trading at and above the Opening Price, Smart Money is accumulating a net short book.
Above the Opening Price or at "Close Proximity Entries" is where Smart Money is looking to go short.

Manipulation Phase:
The False Price Move caused at Market Openings or prior to news releases is a form of Manipulation.
The False Price Move is intended to lead Retail Traders on the wrong side of the Market. ICT calls this a Judas.

Distribution Phase:
Distribution is where opposite side of the Candle forms into the closing of the Candle.
This is where Smart Money distributes their accumulation of Shorts.
We can expect the Distribution Cycle to take place around 3:30 - 3:45 PM NY Time.
You do NOT need to predict where the Low will form or where the candle will close to be PROFITABLE.
DAILY
 Close Proximity Entries [CPE]
The Opening Range defines how much movement below the Opening you will allow for High Probability Short scenarios.

This is called "Close Proximity Entries" [CPE]

This is ideal if you missed an entry above the Opening or if you want to Pyramid a setup.

Opening Range:
Step One: Open + HOD = Opening Range Projection
Step Two: Opening Range Projection - Opening Price = Opening Range
Every potential short in a daily range is found here.
This is where FVG's, Imbalances, Raids occur.
SETTING UP OPENING RANGE WITH THE FIB TOOL
 CLOSING REMARKS
AFTER STUDYING THE CONCEPTS FOUND WITHIN THE ICT MENTORSHIP, YOU WILL FIND PARTICULAR LIKINGS TO SOME CONCEPTS OVER OTHERS...
YOU WILL FIND TOOLS THAT YOU PREFER TO USE TO GIVE YOU A SPECIFIC TYPE OF OUTCOME.
AFTER A WHILE, YOU WILL BE ABLE TO FORMULATE A TRADING MODEL BY BRIDGING IT ALL TOGETHER WITH THE TOOLS THAT FIT YOU AS A TRADER.
THIS IS WHEN YOU ARE ABLE TO BUILD YOUR OWN TRADING MODEL.
THIS TRADING MODEL WILL DETAIL EVERY ACTION YOU PERFORM IN THE MARKET.
TRADING MODELS ARE USED TO PROMOTE PROCESS-ORIENTATED THINKING, AND NOT REACTIONARY/IMPULSIVE TRADING.

FAILURE TO UNDERSTAND BIAS, HOWEVER, WILL SEE ICT CONCEPTS FAIL.

IF YOU SEE AN FVG, BUT IT IS AGAINST THE BIAS, THE PROBABILITY OF THAT FVG HOLDING IS LOW.

IF YOU SEE AN FVG, AND ITS TRADING WITH THE BIAS, THE PROBABILITY OF THAT FVG HOLDING IS HIGH.

UNDERSTANDING THE BIAS THEN ALLOWS US TO FOCUS ONLY ON HIGH PROBABILITY TRADE SETUPS, WHICH RESULT IN A HIGHER WIN RATE.
Find Extra Examples for the following...
STEP BY STEP PROTOCOL
FRAMING OUR DAY EXAMPLES
3 DRIVES PATTERN EXAMPLES
MORNING STOP HUNTS EXAMPLES
AFTERNOON STOP HUNTS EXAMPLES
DAILY RANGE PROFILE EXAMPLES
SIGNS THAT THE MARKET WANT TO TREND HIGHER
SIGNS THAT THE MARKET WANT TO TREND LOWER
DAILY BIAS & RANGE EXPANSION EXAMPLES
THE 2 ENTRY PATTERN EXAMPLES