The SMT is a CONFIRMATION tool.
You need to identify Key S&R levels as ICT has said in his above post.
You are looking for key S&R levels on your higher TF's and waiting for price to trade to these levels, when price is at one of these levels you then apply the other tools you were given being pivots, OTE, institutional levels, kill zones etc and should you say ok I will take a trade at this level based on these tools if you THEN see SMT divergence between the 2 pairs you have confirmation of your trade.
As far as drawing S&R levels I think you are over doing it, scroll through the daily,4 hour and 1 hour and look for key levels, take into account previous days high and low, previous weeks high and low, and maybe 1 or 2 levels on a smaller time frame where there were clear reactions. Look at ICT's previous PCT video, that is mostly what you need to do.
As far as success goes using this method, It takes times. i demo'd for close on to 10 months until i went live. Hard work day in and day out, I literally have a full file of notes and research on everything Michael has taught. You have to really study this stuff, I see guys on here posting trades 1 or 2 day after finding the thread.. They are just doing themselves a disservice, What Michael is doing can set you up for life, it should not be taken lightly. At first there will be losses and then breakeven and then slowly but surely profit. I look for 8%-10% a month, last week making 2.33%, nothing outstanding but my mindset is on a larger account.
This is more or less in reply to some posts with questions about pivots, S/R etc. from (I assume) newbies like myself (at least with this method).
I came across this post from Shaundd so I figured I'd cut and paste some parts that I find relevant (not that the rest of that post is not important).
"Hard work day in and day out". Indeed
I too am building a humongous library full of screenshots of the videos with remarks on them plus an index for every video so that I can refer back to videos for certain subjects in due course. I am going through the thread, reading posts and learning. Every once in a while there is an unlisted video thrown in - why am I not surprised that the view count for those videos is so much smaller than those which are listed on the front page and on YouTube ? Does the majority not want to put in the hard labour ? Does the majority want a quick fix, instantaneous reward and all that ? You betcha - the view count is the proof.
Ask yourself this for a moment: Which group do YOU belong to ? Is that where you want to be ??
I (and others) have said it before, and I'll say it again: there are NO shortcuts. And, for those who insist there are shortcuts, please be aware of the fact that there will be other traders who DID put in the hard work. They will be waiting on the other side of your (very likely) mostly losing trades. Don't follow the shortcut route - do NOT do that to yourself, you're worth more than that.
The info that Michael has given is very detailed indeed and it is simply priceless. That said, do NOT expect that you will master this on a rainy Sunday afternoon, because you WILL lose your shirt and achieve everything Michael doesn't want you to achieve: an empty bank account, utter frustration and -ultimately- broken dreams.
Michael, once again: Thank You For All Your Efforts Sir
Last edited by PippyTheGrt; 02-17-2012 at 09:35 AM.
Reason: Keyboard f-up. T's are getting difficult..
thanks guys. very kind of u all. what is the purpose of plotting all these fractals and not just support and resistance lines of different time frames??
That would be to determine Market Flow in an attempt to make sure one trades in the right direction.
May I suggest you start watching the videos on the first page of this thread ? They will help you to build the insight. The S/R and Determine Trade Direction videos are right in the beginning and they deal with the matter.
Excellent post, Shaunnd. You took the words right out of my mouth! I have also been studying this for close on the same amount of time, and I estimate that I have spent something in the region of 600-800 hours on ICT stuff alone. I also have a full file of notes, and these have been condensed down into 10 laminated sheets that make up my cheatsheets.
Yes, the concepts are simple ones, but that doesn't necessarily mean that they are simple to apply. The reason I sometimes digress into less than technical analysis is purely because I believe there is a gap between the science of signals, and the art of applying them. Yes, we have to be firm in our rules, but I think the real progress comes when you become intuitive in the application of the different tools. In short, there is a lag between knowing the tools, and using them successfully. Too many people underestimate the extent of this lag.
And while I'm at it, I might as well re-post this post
The laminated sheets are something I use as well for my trade strategies. Keeps them free from coffee & saliva
For timframes, I use daily and higher. I will get recent 4 hour sr lines, but personally, I don't use the historical ones.
I look for turning points where price moved in one direction. Hit a point and reversed. Usually lookin for well over 100 pip moves. I don't use small bounces as sr levels. I'd have way too many lines on the chart.
So daily, weekly, monthly sr levels with large moves to the point and bounces away.
On 4 hour, I'll use recent (past couple months) but not much more than that.
Ah thanks for the response...yeah, the charts are really starting to get crowded but ill definitely keep it in mind, thanks !
I finally figured out that I am terrible at trading LO. When I first started trading these concepts I was almost trading LO almost exclusively. I lost 12% of my account during that time (about 2 weeks). Starting last week, something clicked when I was watching the charts during the NY session. I decided I would skip LO for a while and see what happens. Since then I made back all my losses and am up 3% on m original account balance. 4 trades, 3 winners, 1 loser, and the monster winner I missed by 1 pip yesterday. Hope I can keep it up. Thanks a lot ICT.
Hi Pete, what Would you say the reason is for this improvement? Is it because you have more time for analysis or is it easier to tell which direction the price will be going?