Original subtitles

Teaching number eight of eight in December, 2016, ICT mentorships

content we're dealing with specifically double tops and bottoms.

Okay.

Before we get into it, um, I want to talk about measured moves

and clean highs and clean line.

And we look at this price action in here.

We have a drop down in price with relatively equal highs in here.

Okay.

In the marketplace, there is a pretty reoccurring phenomenon.

It takes.

About measured moves

and

you can see

this price swing here projected up.

It gives us pretty close to that level up there.

And when I was going through.

Coming up as a trader, I took a lot of the things I learned from

institutional trading and retail trading and blended the two together.

And I knew that there'd be runs on stops above the highs and

runs on stops below the lows.

And I noticed that there was measured move ideas throughout all of prices.

And I also noticed that by blending some of the things like price delivery and

double tops, like we see here, these two highs here in close proximity to

one, another price has already shown a willingness to want to go lower.

And inside this consolidation, let's take a look at the liquidity

pools and ranges above and below.

Well, above here we have.

This range here.

Okay.

And what I'm noting here is this candles opening 77 42, and this candles.

Coming in at 77, even big figure.

So there's our range in here.

Now what I've delineated on the chart is the open at which price was enough candle,

beginning and another up candle here.

And then everything below this candle here is all sell side delivery.

So there is a gap or liquidity void.

In this range here, down here, we have a fair value gap.

Great.

In here, these candles here, this candle here.

And we have the body of the candle of this down candle, which is the

bullshitter block, which is right before this big move up to last down candle.

We're going to focus primarily on the open on that candle.

okay.

So we have mapped out both sides of the market's liquid.

And we can now build ideas about what we would reasonably expect to see price deal.

Now, the retail universe is going to see this as tabletop.

So therefore there's resistance.

Let's get short and put a protective buy, stop above these highs.

And they're gonna be looking for the market to trade down into this

low, because support resistance says this is where support.

So therefore probably should reach all the way down to that level.

Institutionally, what we would be thinking is price definitely

has by stops above here.

So traders that are already short back here, we want them to drop

their protected by stops down here.

So we're going to wait for price to drop lower closing this fair

value gap and potentially hit this order block level then.

A price dropped down to that level.

We could reasonably expect price to go back up and clear out these buys

stops or the market could come up straight into this void, close it

in, and then trade lower to close this fair value gap or hit this.

Pull a shorter block to close the trade.

Here are the two scenarios.

As it is, the market starts to break down.

So we know they're going to be looking for this side of the liquidity first.

So that means they're going to drop in to this area here and this

fair value gap or shorter block.

And then we'll expect to see the equal highs or double top to be blown out

and to reach up into this area here.

But at this point here, we also noticed that we have.

In here.

And we also have the liquidity void up here in a fair value you got below.

So we're looking for the market to trade down,

hits the ball.

Shorter block

shows, willingness to want to rally

double top is now gone.

There's buy stops are gone.

We're looking for the void closing up here.

So now we're going to take our level put rate on that candles opening right there.

Comprise trades up, hits it to the PIP.

High comes in at 77 42.

To open on this candle comes in at 77 42 double double-talk by stop liquidity.

Run up into a liquidity void to a bare shorter block, which

is the last two of candles.

He goes right to the liquidity void being closed in by stops,

ran out above a double top.

Then the market makes you run the liquidity below that low, and

then you go, let's take another example on double tops and bottoms.

And here we have a double top.

Price has traded down into a bullet shorter block, which is the last

down candle rate for the up move.

This would be a nice buying opportunity here.

So what would you be reaching for?

What liquidity?

Well, retail is going to see this as resistance.

So in the mind of the retail universe, they see this as resistance here is

price hit this here and it traded lower.

Bye stops are above that.

Now short traders have they're protected by stop above this

equal high or double top.

And you know, there's going to be bikes that's about this high, but nonetheless,

we're focusing on double tops and bottoms for this teaching bull shorter block

here who could be a buyer here, price are we reaching for and through this?

Now the question is, is how much beyond that?

We have our double top, again,

your measure to high, down to the low between the two peaks.

Okay.

So we have the high down to the low.

We can project that

up here and now, while we tell things, this is where it's gonna to.

The algorithm is going to reach this far up because it's going

to remember the range back here.

So we're looking for 74 45

market rallies trades through here,

right in here.

There's probably some kind of a mental divergence and just.

Completeness sake.

And this month teaching let's put a momentum indicator up

in here, some diversions right there at a level of old resistance at a double

top retail is going to think this is a cell, and they're going to look for price

to come back down to this support level.

That's what retail is thinking.

We're thinking it's going up to 74 45.

We used the double top is here by stops.

You're above that.

And we're going to take the measurement that the algorithm is going to use and

project that above to get its objective.

The high comes in at 74 46 off by one PIP.

And there you go.

You have a market move, right to a specific price level,

running to double top out.

And then the remove cause the subsequent down, move, running

out to liquidity below these lows.

And now we're going to look at the double bottom traders are going to see this as

support price, rallying way sell stops.

We'll build up the low here.

You used to high down into the low there's a range, and we're

going to project that down

right there.

And what that'll do is that'll give us our algorithm, objective or price.

We'll look to expand and seek downside liquidity.

And there you go.

And subsequent price reaction.

Yes.

Right back up to the double top reference point.

So it's exactly on both price points here and here.

The tip off is when you're looking for double bottoms and double

tops, the algorithm is going to know those reference points.

Even if time has passed, it knows how to find these reference

points by consolidation.

Then it takes those projections and moves it above.

And below and expands down and above that far.

And that's why you get these bike reversals on both sides of

the marketplace and why you get the reactions as a consequence.

So when you're looking at double tops and bottoms, while they may take time

to events and get through and trade through, We never trust double bottoms

and double top, because we understand that the market makers and the interbank

algorithm will go through these old highs and old lows seeking liquidity

below them in the form of cell stops above them in the form of buy stops.

Extreme ends of the range is where high probability trading is in the

middle of the range where there's low.

When we use double tops and double bottoms, we're framing the extremes

of the current trading range.

Every time you look at your charts going forward, you want to be highlighting

these double tops and bottom areas because they're going to give you

specific laser guided precision levels at which price will drive through above

for the buy stops and below for the cell stops, you can see on an hourly chart.

Gives us a lot more framework instead of using like a 15 minute

timeframe for intraday trading, where usually it's a 10 and 20.

Run on stock.

Usually we expect a 20 PIP, 10 to 20 foot range run above and on high or 10 to 20

PIP run below an old low for stock runs.

When we're using higher timeframe charts, like the hourly chart,

you can't use a 10, 20 PIP grade.

You have to use other ideas and the algorithm or reach for these

reference points based on the double task and the double bottoms.

And you can see that it ranges in this case.

It's a 48.

So it's moving that far based on the movement inside of the double

bottom or inside the consolidation.

And then here, it's moving based on this mood here, inside the consolidation

before the level top is right now, notice the double top formed here.

And we had a reference point of this level based on these double top

highs in the rains projection inside of it, price traded all this time.

Until eventually they were here, it worked it out.

So that's why I taught in September what you should be focusing on.

Look for levels that are clean like this.

You may not have a trade today with that information, but it will give

you insights at a later time when we start to run through it, or once

we have run through that level, then we can understand where it's going

to reach for and contrarian view.

If they've taken the buy stops already, what's out of the

marketplace, they going to reach.

The cell stops.

You can see that happening here, go through your charts.

And I'm sure you'll be amazed at how many times you see this phenomenon

take place and it's on all timeframes.

So don't think just in a 15 minute, five minute basis or hourly, look

across all the timeframes and you'll see it's there until next time.

I wish you good luck and good trading.