All language subtitles for Lesson 1.4 Openfloat LiquidityPools (J) EN

Okay folks.

Welcome back.

This is lesson 1.4, defining
open float liquidity pools.

Okay, we're gonna be looking at the
Canadian dollar for this teaching.

Okay.

What you're looking at here is a chart
of the Canadian dollar futures chart.

So the March delivery
contract for Canadian dollar,

and this is the dollar
CAD pear daily chart.

And we're looking at price.

Well we'd like to do is
identify on a higher timeframe.

Where are the liquidity
pools for the large funds?

Because the liquidity pools for the
large funds is largely where markets will

want to reach for apart from long-term
fundamentals on a intermediate term basis.

That means about three or four months,
the large funds open float the liquidity

that's above old highs or below old lows.

That will be generally target.

Every quarter, how do we go about
identifying which ones that we

should be focusing on right now?

We have to incorporate a
technique called open float.

Nope.

It float is simply just taken in
the last three months or taking the

last month and a half to the next
month and a half in the future.

Uh, encapsulating that time.

And basically you're looking at.

Three months of data.

And by doing that, what we'll do is
we'll give you a range to look for the

highest high and the lowest low on the
daily chart, which will lead to, to

where the large funds liquidity pools
are above and below the market price.

For example, let's assume for a
moment it's August 1st and we can

look back and see where the highest
high was in the last 60 days.

Over the last 40 days.

And over the last 20 days prior to
August 1st, we can identify also the

lowest low in the highest high in the
first 20 trading days to the right

of August 1st, then 40 days out,
what's the high and low of that range.

And what's the high and low of the range.

60 days out from August.

When you have that range, 60 days,
look back and see the A's cast forward.

That is open float.

You want to find the highest high
and the lowest low in between

those two reference points in time

on a near-term basis, you can look
back and see what the last 60 days

trading days range was high and low.

In this case, we can see the lowest.

And the highest here going forward,
because we're looking at the look

back period here, casting forward.

Those levels.

We can see that eventually during the
month of September, those highs that

were formed in the latter portion of
July, 2016, they were in fact rated.

So the market was drawn to
the, by stops on the fund.

At those July highs extending it out.

So we have 60 days look back and in 60
days cast forward, we can see what the

total open float is with the low end
scene here in the high end scene here.

And see the market did in fact, eventually
still dry forward reaching for the buy

stops above the October highs in 2016.

So if we're looking at the market
like this, we can also identify

where significant short term and
intermediate term highs and lows are.

If we look at the last range of 20 days
behind us in 20 days, casting forward,

expecting a new hire, a new load.

Because no one can accurately
depict the future forecast.

The future.

We have ideal times to look
for in terms of intervals,

20, 40, and 60 days intervals.

Looking back for the most
obvious by stops and cell stops.

Don't just look for the highest
high in the last 60 days and the

lowest low in the last 60 days
behind us or in the look back phase.

What we're doing is, is we're
looking for where's the near

term high and low in the last 20.

Where's the short term high
and low in the last 40 days.

And where's the intermediate term
high and low in the last 60 days.

That same thing can be done.

Casting forward for looking at August
1st, 2016, we can cast forward 20

trading days and expect a range of
high and low to form noting what that

high and low is on that particular
range will give us the liquidity point.

That are on a near-term basis, the
easiest ones from the market to reach for

when we're looking at short-term trades
and day trades, that range is going

to be easy and helpful for you for
intraday, scalps, and day trading.

When we look out 40 days, it gives us a
little bit more of a short-term basis.

For defining the liquidity pools on the
daily chart, looking for their last high

in the last low, in the last 40 days,
that means the highest high and lowest

low buy stocks will be above that high
and sell stocks would be below that low.

And now he see 60 days cast forward
from the 1st of August would give us

the boundary point at which open float.

In terms of time, not in terms
of price, but in terms of time.

So we are bracketing the market if
you will, 60 days forward in time.

And we're looking at
back in the past 60 days.

So we have 120 trading days of
what would be called open float.

We're looking for the highest high and
the lowest low net range, but every

20 days there's a high and a low for.

Now you about to
experience a growth spurt.

One of the most powerful patterns I like
to trade is the turtle soup, which is a

false break above old high, and a false
break below an old well, the pattern that

I learned about that was taught in street
smarts book, while I'm not teaching that

pattern here at a respect for the, the
authors of that book, uh, the idea of a

false break above or below, um, based on.

The turtles trading pattern, which is
a long-term trading pattern or system.

If you will, that allowed long-term
trends to pay out the turtle

traders and turtle traders.

If you don't think they are, uh, Richard,
Dennis put together a hodgepodge of

different walks of life, people all from
different walks of life, for the purpose

of teaching them the concept of trading
and he used the long-term training.

And he thought that buying a breakout
about 20 day high holding for long-term

trends or selling short a 20 day
low holding for long-term trends,

uh, while they had a lot of losing
trades, their winners were monstrous.

It's a trend following system, which
is what I teach that the large funds

are in the foreign exchange market.

They're long-term trend following because
these markets are highly linked to.

Interest rate markets, which
are under underlying fundamental

drivers for the marketplace.

Long-term trends are in fact fundamentally
driven in currencies, but because the

system was based on buying on a breakout
of the 20 period or selling below 20

period low, that breakout many times was
false and in itself gives us an edge.

So if we look at every interval,
20 trading, Which is what

we have here at 20 40, 60.

You can encapsulate where the next
high and the next low is on price and

where the highest and lowest low on
each 20 day interval going forward.

And looking back you'll know where
the buy starts and the sell stops are.

So that way you can take
respective trades based on that.

Also, if you notice that
the buy stops keep getting.

And rarely do the cell stops.

Keep getting hit by default.

It teaches you to institutional order
flow is what bullish is looking for.

Higher prices.

It's keeps drawing on the
biceps of other marketplace.

Conversely, if we notice that the cell
stops keep getting ran out and very

rarely do to buy, stop, keep getting hit.

That tells us what for institutional
order flow tells us that the

institutional or flow is bearish.

So therefore the banks are making a
move on the large funds, liquidity below

the lows or running their cell stops.

Okay.

Moving forward one month,
this is September, 2016.

The same thing is done here.

We've identified where the ranges
in terms of the look back 60 trading

days from the beginning of September,
and we have 60 trading days cast for.

We're gonna look for the lowest
low in the last 60 trading

days prior to September 1st.

And that's this one here in the highest
high in the last 60 days is here.

And again, we can keep noticing
that the buy starts above old

highs, keep teeth getting taken out.

You can see that highs violated
also in the month of September.

Moving forward.

We have October, 2016 look
back period of 60 days.

And the cast forward of 60 days, we
have identified our range or open.

The highest tie in the last 60 trading
days prior to October 1st, 2016 is this

high here and the lowest low in our look
back period of 60 days is here to open.

Float on a large fund level are
referenced by these two price points.

The higher it's where the buy stops are
and the lower is where the sell stops are.

So they're looking for.

The bus stops at Butler marketplace
and they keep taking those by stops

out notice also in the first 20
trading days to the right or the future

from October, 2012, there's a load
that forms in the Canadian dollar.

It takes the lows out in the form
of the bodies of the candles made in

the last portion of September, the
names of rejection and trades higher.

So we had one attempt here
to clear out the cell cycle.

Moving forward, delineating our
open float range for November, 2016.

You can see the look back period,
60 trading days, maximum 40 trading

days and 20 trading days, the highest
high and the lowest low formed in the

last 20 and 40 and 60 trading days.

The lowest lowest.

Highest high scene here.

And again, going forward into
November, we can see that that high

was in fact taken out on the upside.

So they keep taking the buy stops
out and institutional order flow is

indicated as bullish casting forward.

One more time into December, 2016.

Looking back last 60 trading
days prior to December 1st to

the lowest low is seen here.

Southwest will be resting below that
and the large fund level and by stocks

will be resting just above the high.

Seen here notice also in the
first 20 trading days after

December 1st, 2016, we made it.

And then price ran eventually up into
creating another higher high, but blowing

at the buy stops above the November
high, and then ultimately making a

run down into a lower low for January.

And it forms in the first four 40
trading days after December 1st, 2016

and going forward in time.

At the time of this
recording, look back, period.

Last 60 trading days, you see
the lowest low as seen here.

Highest high seen here.

We have already violated the lowest low.

So we've taken out the cell
stops on a large funds level and.

We can look forward in time for a new
price, like the retrace higher, and

then see if they want to take it lower
because it's all indicating that they

want to take out the sell side liquidity.

Now let's take a look
at the dollar CAD payer.

This is a daily chart and let's apply
some of these ideas on the daily chart.

Okay.

You can see the bodies
of the candles over here.

We did WIC down below.

1 30 50 level and retrace a little bit.

That's where the cell stops will
be resting on immediate term

basis because we're looking at
a daily timeframe, price events.

He does trade down there and
takes those cell stops out of the

marketplace and quickly runs away.

Next area up here, the
bodies of the candles.

You can see that Wix through
it by stops will be resting

just above that large funds.

Have there by stops taken out
here and they quickly rejected.

We have a low down here with the bodies
of the candles sales thoughts will be

resting just to below that and we can
see the market does in fact sweep down

there and take the sell side liquidity.

So what makes these false breaks
and false breaks higher and lower?

So lucrative is the fact that
we understand that large traders

in the form of a fun trader.

They have their biceps above
these levels and they have their

cell stops below these levels.

Every 20 trading days, there's going
to be a new liquidity pool formed.

It's going to be on the buy side.

And on the sell side, you just have
to identify where those ranges are.

In respect to terms to where the most
obvious sweet high swing low is form,

and then frame that going forward.

Whereas the next 20 days, high, low,
whereas the next 20 days, high lucky

going out, but looking back in the
last 60 days and looking forward.

And the future is 60 days gives us the
range for open float, the highest high and

the lowest low in that range of 120 days.

That's what the large fund macro is.

In other words, where they're aiming
for the large fund by stops or sell

stops, they're going to be derived
at looking at worth of range high

and low is on the last 120 days.

60 days backwards.

In time and what the next high and low,
if it makes it higher high in the next

new 60 trading days, we don't know where
that high is going to be in the future.

We don't know if they're going to
create a higher high, or if it's

going to make a lower, low, we just
monitor as price creates new price

swings, higher highs and lows.

Where are we in relative terms
to the last 60 trading days?

Are we making a higher.

Then the H the highest high, or
are we making a lower, low and the

lowest low in the last 60 days.

And we look forward 60 trading days
into the future, and we keep moving

that basis forward each new month.

We're looking for we'll eventually
arrive at the institutional order

flow by default, you can see where
they're running the market they're

taken out by stops continuously,
rarely if ever taking out sales.

What's telling you that they
want to press the market higher.

They keep grinding
against those large funds.

So if it's seen as the opposite,
where we keep seeing the south stops,

keep getting ran out and very real.

Do the buy stops, get taken out.

Institutional order flow is bearish.

So therefore, as long as
we can continuously see

the market making new lows.

We keep watching that
range of the last 60 days.

And where are we in relationship to that?

Are we above it or below it?

If we're above it, we have to continuously
keep seeing by stops, get taken out.

If you start seeing cell stops get taken
out, we're probably making a quarterly

shift in the reverse has said if we're
below the last 60 days, And if we're

below that last 60 days, low, we're really
oversold we're in a deep discount market.

And if we start seeing by stops
getting hit and very rarely new,

we now see south stops getting hit.

We're probably be forming a market
structure shift, or quarterly shift

for a new direction in the marketplace.

And you can see that in fact is
what happens here with the Canadian.

So let's take this information
and go back to the futures market

and take a look at some things.

Now, obviously this is going to be the
price action of the futures contract,

which is going to be inverted from what we
see when we're studying the dollar index

versus the Canadian dollar, because that
payer starts with the us dollar first.

That means when that market is going
higher as a payer, that means that dollar

strong and Canadian dollars is weak.

If the dollar Keds going.

Lower.

That means the dollar index is weak and
the Canadian dollar is strengthening well.

In this case, we're looking at the
futures contract of the Canadian

dollar, and I want you to look
at the same reference points we

just showed in the previous slide.

We're just going to do the
opposite in the futures market.

Let me see the bodies of the
candles being ran out here in

December, and then quickly rejected.

We can see the bodies of the candle
made in November, gets rated in

December and quickly rejects.

And it runs for what the
bodies of the candles here.

We're running the Ohio where
by south we'll be arresting and

that's where we're at presently.

But prior to that big run-up
off of that 73 52 73 65 level.

Take a look at this right here.

I gave you a teaching with the Australian
dollar and I showed you how we can use

these quarterly shifts to take place and
open interest off of support resistance

ideas on a hard timeframe basis.

When we're looking at higher
timeframe charts, we are

identifying clues and seeking.

Evidences that we can see that
they are about to make a move

on one side of the marketplace.

We understand what's making that
short-term fluctuation could be

largely attributed to just running
the stops on funds, large fund

traders, buy stocks and sell stops.

But it's not always that the
markets are moving based on very,

very long-term fundamentals.

And as it relates to higher
timeframe charts, but every three

months there can be a manipulation.

Phase in the marketplace that still
can be a catalyst for us to be a trader

taking high probability entries and
looking for high, probably exit points.

And by looking at where the logical
fund level traders buy stocks and

sell stocks would be, and looking
for evidences that the market is

showing participation by smart money.

I E banks, if the market's trading
down to a support level at 73, 80 to 73

16, We have a clue here that wants to
market started trading lower from the

7,500 to 74, 60, 74, 40 level to 7,400.

And then once we got below 73, 80
level, um, by that point open interest

had already tanked and you can see
clearly here, that's a huge drop.

It's a massive drop.

You only need a 15%
decrease to have a massive.

Indication that there is big, huge,
um, institutional sponsorship behind

the move that you're expecting.

If open interest is declining,
what they're saying to us is they

are not willing to be offering,
sell side liquidity to buyers.

They don't want that.

So they're scaring those individuals by
dropping the market really quickly and

open interest declines rapidly, open
interest, only declines as an evidence.

That the smart money are not wanting
to be heavily short, high open

interest is a indication that there's
a big, massive liquidity, uh, program

that's been offered for buyers.

The bank is offering that as risk.

They're holding the risk on that, but
if open interest declines while the

market drops off precipitously, and it
goes into a support level, because look

at what's happening in November, 2000.

The Canadian dollars future contract.

It rallied from around 73, 80 up to 76
40, which is a very respectable range.

Price comes back now runs the
bodies of the candles that was

formed as a low in November, 2016.

Price comes down again, looking for
another shift in the marketplace.

It runs out the sell stops below
the 73 80 level with an old

low, remember we looked back in.

Higher timeframe, institutional order
flow, reference points, liquidity

pools, water blocks, fair value gaps,
equilibrium, all those price points

we used and learned in September.

We look for those in our
higher timeframe charts.

We're seeing a liquidity pool in the
form of a cell stop resting around 73 80.

They make that run and on low open
interest at a support level, they are

indicating that there's going to go up.

If the futures contract for the Canadian
dollar March contract delivery is

indicating that there's very low open
interest at a support level at a time

when it stops have been ringing up a
little marketplace, that's indicating what

potential strength and you can see the
price action that transpired after that.

Rather explosive price move, looking for a
move from 73 80 all the way up to the 76.

So 300 pips move up from one specific
level that could be easily derived by

looking at the evidences that we've
shown here in his teaching using open

float casting forward 60 days, casting
forward 40 days, casting forward 20 days

notice also every 20 trading days, the
high and the low becomes very obvious.

You can start circling these
as you create new high.

Every time, there's a new hire high
note that, and then wait for the

price to come back down to an old 20
day low study that every 20 day Hein,

every 20 day low is going to have
buy stocks and sell stocks, resting

above the highs and below the lows.

If you do this as an exercise going
forward, you'll see clearly what

side of the marketplace it's seeking.

If it keeps taking out the
buy stops or the whole.

The market is doing
what it's moving higher.

That means institutional
overflow is on the buy side.

You don't want to be selling
short and there's conditions.

If the market is taking out the sell
side, liquidity, continuously and

rarely ever taking out the highs of
the price action, that means that

institutional flows indicated lower.

And you want to focus primarily
on being short until we get an

obvious change in direction.

How would that happen?

Well, if you go and you start trading
to the lowest low in the last six

years, Well, we're probably going to
be very, very deeply, uh, oversold and

we're going to be in deep discount.

Even if the price only bounces a little
bit on a hard time for like this, it

can bounce, you know, a great deal.

It could be over 150 200 pips sometimes,
and then eventually roll over.

Uh, fashion and keep going lower.

You don't want to be caught on
the wrong side of the marketplace,

trading on a hard timeframe chart
and not see the evidence is that

it's given you and trade accordingly.

You have to have all these things in
mind looking for where the liquidity

is and the easiest way to do it and
to make all this very simple, because

it could be very easily complicated.

And I'm sure it probably
complicated in many of your minds.

What you're looking for is a revolving
continuous range of 120 days.

And you, whatever day you're looking at,
you look back 60 and you look forward 60.

So there's 120 days there and
you're constantly monitoring.

Where's the highest highs and the
lowest low in those, in that range.

And that's where the buy stops
and the sell stops are going

to be on a large fund level.

The.

Look back phase is where the
hard stops are going to be.

That means where the actual buys
and sell stops are going to be

above an Ohio and below an old low.

But if we are looking forward studying
new price action, as it occurred,

You need to be mindful of where
you are in the last 60 days range.

Are we near a high or are we near a low?

And that's also going to be indicative
of where we see the next quarterly shift.

If it's going to be continuously moving
higher and higher and higher and keeps

taking out by stops eventually, unless
we're on a one-sided parabolic price

move, which we'll teach about generally,
you don't see too many of those.

Uh, the market generally moves from range.

And using this concept, it will
be very beneficial to you because

you can see where the near term
that means to 20 period high and

low in terms of trading days.

And I'll say that again, the next
near-term move is going to run on

near term buy stops or sell stops.

That means the last 20 days range,
what's the highest high and lowest

low that's the near term open float.

The short term open float is
what's the highest high and the

lowest loan will ask the 40.

And the intermediate term open float
is going to be the highest highs

and lowest low in the last 60 days,
knowing where you are in that range.

And what side of the marketplace
keeps getting taken out.

We'll give you clues as to what the
next shift in price is going to be.

Once it starts to break down, you know,
you're going to have a significant

price move and you can trade that
accordingly, even on a daily timeframe

where you don't have to go down to
a lower timeframe for entry, you

can execute purely off of the daily.

So we're going to build on these
ideas as we go through the rest of

January until next time, this concludes
this teaching, which good luck.