Original subtitles

Okay folks, we are looking at less than 1.2 of the long-term analysis,

implementing macro analysis, quarterly shifts and open floor.

okay.

We're going to be talking about open float on is teaching.

The quarterly shift with open float and let's first start by defining what is.

Open float.

The float is the current open interest above and below current market price.

This is going to be in the form of pending buy orders.

In other words, by stops that arresting above or highs, or it could

be disrupting above market price.

Doesn't have to be old highs and sell orders, and it could be below

the market price by very low.

In terms of pips, or it could be below significant lows.

There are open interest in the form of cell stops for entry orders and cell

stops for collapsing long positions, and there are buy stops to get along.

And then by stops to protect short positions, all of those

are equating to open float.

It's the total open interest of the players that are in the market now,

or hope to be depending on where price goes relative to those standing orders.

Okay.

When open float is used to determine buy-side liquidity shorts use protective

by stops above the last bearish shift.

Bye stops above short-term highs.

That could be in the form of a weekly high or a monthly high

five stops above the highest high in the last three months

by stopped above the current six month.

And by stops above the current 12 month high.

Now don't be discouraged by hearing these numbers because you can be really close

to the 12 month high for a long period of time and never really get to it.

Um, But I first remember reading about this type of idea, the range

for the 12 month high and low, I thought to myself, you know, it takes

12 months to get back to that level.

And that just shows how it, my OPIC, my viewpoint was when I first started

trading the 12 month high and low, you can be inside that range for a

long time near the high or the low.

It doesn't take that long to get to it.

So some of the new traders that you see.

Send me emails.

They ask me, how often do I trade 12 month highs and lows?

Well, you could see a 12 month high or low pretty quickly.

It depends on what the range is in your market.

The same thing is said for a six month high.

The one we're going to focus on here primarily is the buy stocks

above the highest high in the last three months, because we're

looking at the quarterly shift.

That's going to be a very.

Significant price level whereby stops will be resting.

So every three months you want to be noting where at that highest.

And there's going to be by stops.

Definitely most likely getting targeted.

If we have a market structure shift Bush, they're going to be aiming for those by

stops above the three-month highs, any run on bias, that's above a short-term

high, which is a monthly high or a.

That's going to give us a strong prognostication for

short-term volatility as well.

When we're looking at the sell side of the liquidity long she's protective

cell stops under the last bullish shift, sell stops below short-term lows.

That can be in a form of a weekly, low or a monthly low south starts below the

lowest low in the last three months.

South starts below the current six month low

and finally sell stops below the current 12 months.

Now, one of the questions I get a lot and I get it actually sent to me

by email, even in the free members area, from my website and on YouTube.

When I talk about running stops, or if I talk about turtle soup,

false breaks, a bubble highs or false breaks below a no low.

The question always comes up is how do I know if it's a market screen?

Stop just right above an old high or below an old low, and

then reverse or keep on going.

And I'm going to teach you the ideas that I use to get to that conclusion.

Uh, w what gives me the conviction that builds to confidence on believing

that it's just going to punch above and old high and probably.

Continue going higher, not by much, in other words.

And then retrace and probably offer a shorting opportunity.

The same thing as reverse for buying an old low once it's been violated.

Okay.

This chart is basically outlining the same levels that we had

for the quarterly shifts.

And every three months, the intervals are shown here.

I kept the majority of the work lines off this used little segments to

delineate what those reference points would still be relative to date.

And I want you to take a look at this chart for a minute, focus and study on it.

And if you can pause it at you for a couple of minutes and note

significant price, highs and lows,

Obviously you can see the one that's here

and a low down here.

So we have two pretty significant runs above an old high and below an old low.

I want you to draw your attention to that.

Short-term low here when price traded below that low, that was

a break in market structure.

Okay.

So we had a market shift, the low that low, and the market continued

trading all the way down until it got to the 1 0 5 30 level.

Whenever we see the barrier.

Shift lower in price.

Your eyes need to go right to the high that just came from because

on a daily chart, that's going to have a lot of liquidity above it.

That liquidity is in the form of a liquidity pool for by stops the folks that

were fortunate enough to be short from that old high trading down into 1 0 5 34.

Their position would have a run on the buy.

Stop, sits residing holding onto a long-term position.

Now you're probably asking yourself what retail trader in their right mind

would have a buy stop on a short held on that long, just to see it come all the

way back up there and get knocked out.

Again, the market's not trading against the retail traders.

It's trading against large liquidity offered by the big funds because funds

are traditionally long-term trend.

Following traders.

These reference points on the daily timeframe are going to be salient

to understanding how open float has a big impact on where future price

movements are going to take you.

As you see here after creating a low of 1 0 5 34, the market does in fact

have one more market structure shift and sends price, higher pay attention

to the quarterly shift markers that we have here every three months.

There is a significant run on liquidity.

The move off of the 1 0 5 34.

It has a break and market structure thing.

You could see the subsequent retracement back to the short-term high and then

price rallies away fills in liquidity void from October retraces back down

into the 1 0 8 60 level and then rallies again, then ultimately making a run

up for the buy stops above the one.

15 big figure

that market structure break there bullishly is the catalyst that sends

the market higher to make the stops above one 15 big figure targeted

below that low, there's going to be a large liquidity.

On the daily timeframe.

Again, it's not for retail traders.

It's going to be for the large funds because there was a significant

displacement among many months, about six months or so the market

rallied from 1 0 5 34 to one, one 1570s or there about, so it was a

pretty significant move for the year.

There's going to be sell side liquidity or sell stops in the form

of a liquidity pool below that low, you see price didn't in fact, sweep

down there and grab that liquidity

neutralizing all the cell stops.

So let's take a look at what takes place and how we can use open.

And help answer some of the confusion you have about why the market should be

expected to go a certain level and then retrace or reverse, and how we can look

forward to one side of the market being predominantly controlled and staving off

any continuation after the move blows through an old high or below an old, well,

as you see here, we have a short-term.

Right before the market runs through that, that retracement back down into the 1 0

7 fifties, the buy stocks, it would be resting about that high they're targeted

in the market runs right through that.

And it also fills in liquidity void to the left from October,

then the market retraces deeper.

And now we have a short-term height.

It was created by that rally about.

Taking the bus stops out that short-term high eventually gets ran out as

well, making a run on the buy stops.

That will be resting above that.

Now what biceps will be resting about that people that wanted to

sell short every time price makes a.

Impulse price swing.

There's always invariably going to be orders that want to be selling there.

And they're going to be sometimes short positions funds will go in

and start working their positions.

And.

And sometimes they get knocked out and that's what's happening here at

many times, you've seen that same phenomenon you ended up going through.

It's just going through a larger scope in terms of order size, and

finally making a run on that one 15 big figure clearing out the buy stops

above the previous October high.

Now I'm going to draw your attention to.

Uh, how do you know when the market's going to reach for one side of the

liquidity or the other notice while the market was trading from the

low, at 1 0 5 34, all the way up to one 15 big figure, there wasn't any

significant move on, sell stops at all.

They were driving price up to take the liquidity out at one 15.

Once that liquidity was taken.

In the front of the bus stop read at one 15 big figure.

The market broke down and created a violation of a short-term low

at short-term low had trailing cell stock resting below it.

Those sell stocks would now would be violated and canceled to any longs

would be knocked out at this point.

Now you need to be paying close attention because this is where

the rubber meets the road.

This short term low, and that run on the cell stops rate below that low here.

You want to draw a special attention to that right now, because this is your

first clue that we are probably going to work to sell side of the liquidity.

We all know at the time when it first forms, we had to start watching

what price does we already know.

We have a strong rejection of other one, 15 degrees.

And we've came a long way from 1 0 5 30 fours with none of the cell starts

taking, except for this one here.

Now we have a short term Hyde it's violated just briefly.

But my question is, is that short term little violation above an old high?

Is that making new ground for new highs?

No, it didn't even challenge the old.

But look at the strong rejection, right about that high.

It creates another lower low.

So this short-term low right here also sees its liquidity in the form

of the cell stops, ran out as well.

My question to you is this at this moment.

Right now it's at the midway point or equilibrium between the 1 0

5 34 and the one 15 big figure.

The chances of this creating a higher high, where we're at right now,

relative to the one 15 big figure.

It's not likely not because it's hindsight and it's right in front of

me, but because it's showing indications that it can't create new ground.

Once the buy stop side of the liquidity is taken, but it's

creating new, lower ground.

Every single time they short term low is violated.

It gathers up more momentum and it gathers more distance between the range

of one 15 big figure and 1 0 5 34.

So every time it drops, it drops a little bit.

But every time it rallies, it fails to make a new high.

Even if it takes a short-term high out, it's not gaining

any more ground on the upside.

Every rally is being distributed.

We have a short-term high here as well, and those by stops are ran out as well.

Same question.

Does this rally above a short-term high create a new high?

No, it can't even get above the previous failed attempt to make another heart.

At the one 14 bit figure.

Then once again, we have a rally through

an old high, does it gain new ground?

No, but it's quickly rejected and trades lower and then violates two times.

It goes below.

The 1 0 9, 10 level once briefly before running up and taking that run on 1 12

95 and then rejecting that level after taking the buy stops out and making a run

for another pass through the 1 0 8 50.

This short from this high at 1 12 95 was on the heels of the U S elections.

We saw strong dollar in the market, quickly rejected all of the rallies in

foreign currencies, the movement below every short-term low and gaining more.

On the downside.

That's the indication you look for, regardless of whatever timeframe

you're trading, but on a daily chart, you're looking for clues that it

wants to gain more momentum on one side of the market or the other.

You're going to reference where the buy stops are of old highs and where

the cell stops are below old lows.

But what you're watching for is the tug of war that takes place between each new

run on staffs below the market and above.

If you notice where the enemy at term highs are.

If intermediate term highs, keep creating lower intermediate term.

And intermediate term logins.

Short-term lows.

Keep going lower each time.

It's telling you to once the open float, the low the marketplace, in other words,

it wants to seek the sell side liquidity.

It's going to draw a lower to nothing about what this has done for you.

It gives you a directional bias on the daily chart, and it takes a long

time for these moves to take place.

But once you study in Christ and you look for these clues, don't cross

many pairs in many asset class.

You'll see that this is in fact what lead you to daily chart, directional

bias, which also will serve you very well in other disciplines of trading,

whether it be day trading, scalping, short-term trading or swing, this will

give you what you're looking for in terms of how do I know what side of

the market is going to make the run on?

Is it going to run the buy stock or it's going to run the cell stops.

Think about what timeframe you're looking at here.

This is a daily chart.

If the daily chart is indicating that it wants to run lower because it has no

problem getting down below short term lows, but every rally has a failure to

make new ground and can't make a higher.

When it does make a higher high it's punished immediately.

But the high that it makes is always just above of short-term insignificant high.

Every time it does this, it solidifies a intermediate term high that is now lower

than the previous intermediate term high and intermediate term high is any high

that has a short-term high to the left.

And to the right of it.

Think of it like a head and shoulders, top formation.

Every time you see a enemy, a term high that has a lower enemy, a term

high to the left of it and intermediate term high to the right of it.

That's actually a long-term high in the middle.

Again, think like a head and shoulders pattern now, invert that, and you'll have

the same thing that would be said for an immediate term, low or a long-term.

Once you see that in price, you'll actually see the market structure

that I actually learned from studying Larry Williams as a new trader.

Uh, you can see the market structure in this entire sample size of data.

It's multiple intermediate term highs and long-term highs that

are significantly signaling that the market in fact wanted to go.

There was a liquidity void around the 1 0 6 80 level to one or 6 35.

It filled that in and went all the way down to the short term, low at

100, 5 34 bounce a little bit there.

And then ultimately once breaking that low.

At 1 0 7 big figure, it reached down below to take the sell side liquidity out.

Now, when you study the daily charts like this, you can look at a lot

of examples, but they require time.

And unfortunately they don't give you a lot of turnaround time for study.

But in hindsight, you can go back and look at a plethora.

Really nice trading examples where you can see where liquidity was ran.

On one side, the market was drawn up for three to six months.

Okay.

Look at the move from the December low of 2015, up to the high made in

may of 2016, it's about six months.

Then the move from that high in the spring of 2016, it traded

all the way down to a low.

Made in December of 2016, again, about six months or so, a little bit more than

six months, but you're seeing the effects of how the quarterly shift takes place.

Also have the runs on liquidity and the implementation of open float, open

float is the study of how the market reaches for the bias in the cells that

are above market price, knowing where.

Borders, we'll be building and stacking above bubble highs and below old lows

that will give you the framework to map out what side of the marketplace,

the market makers and smart money are seeking to make a run on.

If you can determine that on a daily chart like this, it will give you.

Trend daily bias long-term bias.

And it'll give you prognostication for having smart money perspectives,

institutional vantage point with all of your trades until next time

I wish you good luck and good.