Thanks. I’ve watched that video before, but watching it again I see the post from sweetpips that states “…when highs diverge, price goes down, when lows diverge, price goes up.” And ICT agrees with her post. So looking at the SMT for today…
in the grey boxed area I can see the E/U making lower lows while the G/U makes higher lows. Therefore, using “when lows diverge, price goes up” I would assume that at a significant support level, price would be expected to go up. And at around the same time (L.O.) we saw price touch the CPP and trade significantly upward. So if I would have evaluated that properly early this morning, should that have been enough to get me out of my short trade? I felt like everything else was indicating a good shorting opportunity: 4h MF down, OTE from todays high to low having convergence with 1.5480 level and MR1.
Thoughts? Thanks again for your help…i MIGHT be getting a clearer picture now of how to use the SMT :27:
I woke up at 2:00 am EST to look at my charts, and here’s what I saw:
Daily and 4h MF down, 1 hr MF up = Bearish bias
Failure swing on bond yield overlays as 2yr T-Bonds failed to make lower low while both 5 and 10y continued making lower lows. I believe this signals strength in the dollar = bearish bias on G/U
3)SMT showed euro had put in a lower high while cable made a higher high 1:00am EST = Bearish bias because of diverging highs (Do i have the right?)
The light blue circle would have been a great OTE but it had already passed by the time I got up, so I was waiting for the a new OTE from the newly created swing high…
Sadly it didn’t reach there and now it is 4:00 am EST and I think I’ll just close my pending order, go to bed, and wait and see if perhaps there is another chance to get in during NY open maybe. I was SOOOOOOOO tempted to just get in when I saw price moving down from where I WOULD HAVE gotten in had I been up earlier, but I’m trying to force myself to only get in using OTEs. Very frustrating, but I’m trying to develop some discipline.
Simply sitting on my hands…will check back in at NY open.
Edit: So I see now that price only traded down to the CPP and then shot way up for another bullish day. I don’t know if my analysis was wrong or if that swing down to CPP was the short that my analysis indicated (it was a 50 pip move down from the OTE i missed). However, I was looking for it for it to trade down to last weeks low based off everything I mentioned above. Anyone care to tell me where I went wrong? Or was this a valid short trade that I should’ve taken profit off at the CPP had I been in it? Thanks
Sorry for being so late replying to your question. I was away from my screens for about 8 hours. Then, when I got back to business, my internet went down. Verizon FiOS is great. Until it isn’t.
Anyway, I see that you have found your answer. You can pretty much take what Sweet Pip says straight to the bank. She’s a diligent student of all things technical (I think the more technical things are, the more she likes them!).
I would only add that the SMT is just one of the things you should look at. Don’t give it more weight than it deserves. And, certainly, don’t trade on the SMT alone.
The SMT is one of the tools in your toolbox. Think of it like a hammer: every now and then, you’re going to hit your thumb with it.
Will be looking to take 30% profit at 30 pips, another 30% at the 38% retracement of daily high to low, which has confluence with R1, and then let the remaining 40% ride down to the 38% retracement of daily high to PREVIOUS day low, which is right at 1.5600 figure.
Matty
Also, MF is down on Daily, 4h, and 1h, but I was wondering, is it even really of a concern where market flow is as the LC trade is more of a consolidation trade back into the daily range?
So even though it was such a large range today you wouldn’t try and shoot for the 38% retracement? And what do you mean by countertrend? I know it’s against the daily trend, but it could very well be in line with the 4h or daily market flow, yes?
According to my GBP/USD charts, market flow has been [B]UP on the 1-hour chart since the 7am EDT candle today.[/B]
And market flow has been [B]UP on the 4-hour chart since the 9pm EDT candle yesterday.[/B]
On the daily chart, market flow has been DOWN since September 1.
Are you using standard fractals to determine market flow?
Regarding your question, I think you make a good point. A consolidation is, by definition, counter-trend. When a consolidation goes against a trend, that trend could be the “trend” indicated by market flow on any of the time-frames.
But, the UP-trends established by fractals on the 1-hour and 4-hour charts prior to today’s London Close, were in no danger of being broken by a normal LC consolidation.
So maybe I need to do more research on market flow, but I was under the impression (and please correct me if I’m wrong) that market flow was down until a previous swing high fractal was penetrated.
So looking at the 4 hr, using that definition, wouldn’t MF still be down on the four hour since we haven’t made a new fractal high above the previous one?
And on the one hour, I thought MF was down during that time in the gray box because we had a fractal low below a previous fractal low, and then MF finally turned up when the new fractal high formed above the previous one (at 11:00am EDT).
So is this wrong? Does MF change whenever PRICE simply goes above/below a previous formed fractal, or does a new fractal actually have to form (which is what I had thought)? Thanks so much!
just a quick question here - in one of ICT’s videos he mentions the type of account to fund based on amount of capital available. For instance, if you have $9,000 available, you should open a mini account, not a standard account. What is the MINIMUM amount of capital (USD $) he recommended to fund the following types of accounts for proper risk management?
the trend for today was up. A countertrend is shorting during an up day, going long on a down day. Today, the LC on Fiber was trading the turtle soup pattern, the fiber was an OTE entry. Since there was no fib to draw on the cable, the exit strategy was not clearly defined and I exited at 20 pips. The fib on the fiber gives me an exit strategy at 100% retracement, or about 24 pips. One thing I’ve noticed, is the fiber will on many occasions, only retrace to the 50% mark, rather than 62-79% during the LC
Since the LC should be considered a scalp, it will rarely meet additional fib extensions without any news to drive price. Fib extensions can be hit, but more times than not, I would be better off just keeping my pips in the bank, so that is what I try to do and not sweat the pips I didn’t get.
I don’t have much of an opportunity to trade other sessions, so the only factors I really look at when trading the LC is time and price. I haven’t used the TT in weeks, rarely look at SMT, I haven’t even been tracking ADR even though I know I should. I do look at MF, but it doesn’t sway my decision in making a trade (like today). Time and PA is all I’ve been using the last few weeks, and seems to be working pretty well.
I don’t recall any exact dollar amount, but I do recall him talking to someone several months ago and funding an account to be able to trade at least 2-3 lots.
A micro would probably be $450, mini would probably be $4500, standard is more money than I have to trade so never thought about that one. It would probably be $45K though. These calculations are based on trading 3 lots
So what time frame are you basing the trend for the day on? I mean, I can obviously see that when we got to the London close setup, price had obviously moved upward all day, but aren’t we supposed to be basing market flow off of the 4h chart, and the bias becomes even stronger when either daily or 1h (or both) coincide with the 4 hour. And, if thats the case, could you speak to the MF on the 4h chart, cause to me it still seems like it would be down considering the previous fractal high that has formed has yet to be penetrated. Thanks
Thanks for posting what your platform is showing PipARush. I don’t know why mine didn’t show any more fractal highs like yours did. So on your chart, would you say that market flow turned up on that second fractal high that you have a yellow arrow by?
[QUOTE=lazydogs;281836]the trend for today was up. A countertrend is shorting during an up day, going long on a down day. Today, the LC on Fiber was trading the turtle soup pattern, the fiber was an OTE entry. Since there was no fib to draw on the cable, the exit strategy was not clearly defined and I exited at 20 pips. The fib on the fiber gives me an exit strategy at 100% retracement, or about 24 pips. One thing I’ve noticed, is the fiber will on many occasions, only retrace to the 50% mark, rather than 62-79% during the LC
Hey Lazydogs, if you went down to the 5m TF, there was a nice OTE at the L.C right below the 1.5700 figure. I entered at 1.5696 with S/L at 1.5720
I don’t really apply MF to a typical LC trade. If the parameters are met, i.e an obvious trend (on the day), slightly exceeding ADR and not excessively news driven, I’d conclude price has been heavily influenced by institutional intra day traders. They’ve “hit the numbers” (4 pivot points inc. mid pivots) so will want to take some profit before liquidity drops after London goes home.
This is the beauty of the kill zones, affording us the opportunity to ride on the big boys coat tails.
So I ended up following my plan and taking 1/3 off at 30 pips, another 1/3 at the 38% retracement from daily high to low, and the other 1/3 when price stalled at R1. Not trying to be confrontational or anything, but price went pretty much right down to 38% retracement/R1 level. And isn’t that what ICT said to target for LC trades? I’ve only attempted a couple LC trades and this one seemed to work out very well. However, if it was just lucky or I didn’t “play by the rules” i’d like to know. I know even if a trade works out perfectly it don’t mean jack if it isn’t reproducible. Could you explain why you wouldn’t look for the 38% retracement like ICT talks about? Or maybe I’m not remembering ICT correctly…Thanks!
No,Im saying ,on my chart,market flow turned up on 2011.09.26(yesterday) 8 am GMT candle which is 4 am EDT,after the price crossed above the pink line, <img src="//babypips-discourse-media-production.s3.amazonaws.com/original/3X/e/d/ede56aa89484982a48d592296c3b8de3bdc89fe3.jpg" width="690" height="388"><br/> If we scale in on the 15M chart we can see MF turned up on 8:15 am GMT. <img src="//babypips-discourse-media-production.s3.amazonaws.com/original/3X/f/1/f1e5d077144fd60bd9bfc230759e1e994d2c8be5.jpg" width="690" height="388"><br/> More precisely we can see on 5M chart is 8:20 am GMT.... but Clint said market flow has been UP since the 9pm EDT candle yesterday.Probably Im wrong too.
