All language subtitles for yuiklop

Hey everybody. Welcome back to
another installment of the

Currency Pros course. Now today
we're talking about imbalance.

Okay this is going to be a
brief video. There's not too

much to talk about but it's
definitely an important aspect

to our trading strategy that we
need to cover and have a firm

understanding of. So as you can
see in front of me here I have

the Currency Pros e-book pulled
up. And the reason for that is

I already have a a very good
description and lesson about

imbalance here. So what I'd
like to do is just read through

what I've written in the Ebook.
And then after we've covered I

want to go through some real
life chart examples okay so you

guys can see it in action. So
let's get started. One of the

main criteria we look for when
identifying an order block or

refined supply and demand zone
is imbalance okay. So just to

clarify this is not something
imbalance is not something that

we trade solely. It's not any
sort of entry criteria. As you

all know by now we trade order
blocks or as some call it just

refined supply and demand
zones. Um Now, imbalance and a

few other things as well which
we'll go over in future videos

simply acts as confluence to
build a case behind whether or

not our order block is valid or
potentially invalid, okay? So,

excuse me. So, imbalance is
when an order block is

responsible for creating such
impulsive volume in the market

that it throws off the
equilibrium between buyers and

sellers forming a gap, okay?
So, to understand imbalance,

you have to understand how the
market moves. Now, with the

Forex market specially there is
a constant equilibrium or at

least the goal to have a
constant equilibrium between

buyers and sellers okay so even
in this example here you can

see all of these small candles
here it's very efficient price

action okay we have selling
momentum buying momentum

selling momentum buying
momentum and everything gets

covered here it's very
efficient balanced price action

okay but as soon as we see huge
full body candles it create an

imbalance in the market as you
can see here in the diagram

okay it creates a gap we have
one there and we have one here

too this massive full body
candles they represent that for

a certain period of time let's
take this one for example for a

certain period of time only
buyers were in control there is

no equilibrium between buyers
and sellers there's no give and

take there's only give okay so
that creates inefficiency and

imbalance in the market alright
so as I say here this is

referred to as imbalance or
inefficient price action short

form IPA which some people like
to use now these gaps act as a

magnet for price to retrace to
in order to correct the

disturbance in market
equilibrium okay that's a very

important point to take note of
so we don't trade based off of

these but we use it as
confluence because as I place

in the diagram here below we
have a lower time frame order

block maybe not visible on this
time frame but a refined lower

time frame order block is in
this area right up here okay

now we've set entry parameters
you know we're we're expecting

we're anticipating price to
trade higher towards our lower

time frame order block and then
go short from there based on

our analysis right now what
adds confluence to the fact

that price is going to head
towards that lower time frame

order block is the fact that we
have imbalance or inefficiency

in this area okay because price
is drawn towards this like a

magnet in order to correct the
inefficiencies okay there has

to be balance there has to be
equilibrium in the market so

whenever this this happens it's
very highly likely that price

is going to travel towards that
area okay so when we were down

here and we located this order
block up here and then spotted

inefficiency or imbalance here
we can say to ourselves okay

it's very likely price is
going to travel towards that

order block where we can then
look for a short opportunity

okay let's head over to the
next page because there's two

pages in the in the Ebook that
cover imbalance So let's go

over what I wrote here. So as
you can see we aren't trading

based on the imbalance zone
itself. But rather using it as

confluence to strengthen our
decision to target an entry

from an order block okay? An
order block that acted as the

point of origin for such a
disruption in price is

considered a higher probability
entry point okay now let me let

me quickly cover that so
there's order blocks all over

the place right this is where a
lot of people get confused with

order block strategies or
refined supply and demand

because they see them all over
the place and many of them are

valid right but some have a
higher probability than that of

working out than others do and
one of the things that

increases the probability of
success is the fact that that

order block was responsible for
one a break of structure that

we've gone over in previous
videos of course so a break in

market structure but the second
main confluence is that it

actually created an imbalance
it created a gap in price

action okay that's very
important because like I said

it acts as a as a it it turns
price into like a heat seeking

missile basically once it seek
out that imbalance and correct

it and then from that point on
once the imbalance slash

inefficiency is corrected then
price can you and do what it

was intending to do in the
first place okay so another

point here is when it comes to
imbalance or efficiency

inefficiency zones there's no
telling when they will be

filled okay so it could happen
within a couple minutes it

could happen in a couple hours
sometimes it could take a week

or a month or more it depends
on the time frame you're

trading on most importantly but
there's really no telling when

it's going to get filled but we
know certainly that they will

fill when the time is right
okay now this is why we don't

attempt to trade them on their
own it's an important tool to

keep in your arsenal when
analyzing the markets okay so

like I said it's not something
we base our entries off of it's

something we build our case off
of okay so we we find an order

block we have to check off some
boxes right did it break

structure did it create
imbalance is price approaching

it correctively or there's a
bunch of boxes that we need to

check right so this is just
another one of those boxes and

it's another tool that we can
keep in our arsenal alright so

as you can see here price
traveled towards that imbalance

zone filled it right around
here so it corrected that

imbalance and because it
already did that right it it

completed its mission then it
also mitigated the lower time

frame order block that we had
up here once that mitigation

was performed and the imbalance
was corrected you see how price

just melts away in the
direction that it was intending

on taking right and that's how
we can take advantage of in the

market. We use it as confluence
to strengthen our order block

and we take our entries from
the order block, right? So now

that we've gone over those two
pages in the Ebook in a little

further detail, what I'd like
to do is head over to the

charts and go over a few
examples here that weren't in

the eBook so you can see it
more practically, okay? So,

we're currently on Australian
dollar, US dollar on the

one-hour time frame. Now, I'm
not going to use the replay

tool and you know, set trade
parameters and all that kind of

stuff. This video is more so
about being able to train your

eyes to spot these things in
the market. You need to be able

to spot the imbalance until it
it becomes second nature to you

okay? So there's a few things I
can see right off the bat. Now

I didn't cherry pick these. I'm
just looking at the chart in

front of me. And I see plenty
of imbalance but there's a few

that I'd like to go over that
are really good examples. So

let's start from here okay we
have a clear order block there

clear order block right here
this candle here it created

significant imbalance because
look at all that volume that

pushed into the market right
after that small buy candle it

created a lot of imbalance I'm
going to mark this out shortly

and it eventually broke
substructure and you know this

this order block here it led to
this whole move right which

broke more substructure more
structure more it was

responsible for for a lot of
disruption in the market okay

so let's just quickly highlight
that order block

Let's just label it. One hour
OB. Okay. Now I'm going to use

the Fibonacci tool to highlight
the imbalance here. Okay. This

right here is the imbalance.
You know what? Let me hide the

auto block for one second just
so you can more clearly see the

imbalance. So let me explain to
you why this is imbalance. I

set the Fibonacci tool right at
the lowest point of that last

buy candle before the
destructive move and the bottom

of the Fibonacci tool. Keep in
mind we don't trade based on

Fibonacci. I simply use the
tool to map things out. So the

bottom of the Fibonacci tool is
set at the highest point of the

next candle following this full
body candle. Okay so here's the

thing price was trading high
created a minor low went up a

little bit failed to break that
dropped very impulsively and

once it did drop kind of
bottomed out here traded a

little bit higher created that
that minor high right there and

then dropped off again from
there so you see how we made a

low point here and a high point
here right everything in

between oops everything in
between that is imbalance or

inefficiency okay that's
inefficient price action

because there was no
equilibrium between buyers and

sellers now if price created
this huge candle and then this

candle here had enough momentum
to continue higher and higher

and higher until it reached at
least this mark here then there

would simply be no imbalance in
the market that would be very

efficient price action okay
there would be no gap anymore

but that's not what What
happened is we we kind of

topped out here and then
started dropping off once more.

So that leaves imbalance in the
market and we know that at some

point price is going to have to
correct this imbalance. Now

Let me delete that for a
second. I'm going to bring back

the 1 hour order block so this
is the order block we would be

targeting this for a short
position right hypothetically

I'm not going to get too deep
into you know positions here

but theoretically we'd be
targeting this one hour order

block for a short position
because there's bearish order

flow it broke structure to the
downside multiple times this is

the order block okay now the
imbalance is here

imbalance right in that zone
right there so we know that

even though price is trading so
much lower we know that at some

point theoretically it should
come back to fill that

imbalance okay it starts to
right around here obviously

we're we're moving up very
correctively towards that zone

start to fill it here but then
we make one last push fills the

imbalance completely and what
do you know it reacts very

nicely to our one hour order
block right it taps into the

one hour order block from from
that point on we start trading

lower now if you were in a
short position this would

obviously present a good amount
of profit and of course we have

we would have lower time frame
order blocks within that wick

as well price comes back up
mitigates anything within that

wick and then really melts from
there okay so this is just a

good example of how we can
utilize the knowledge of

inefficient price action or
imbalance to to build a case

behind our bias okay so we have
a short bias here but the

confluence we can add up to to
go with our short bias the more

confident we can be in our
overall trade. Okay? Now even

even within this bullish leg
here leading up to that point

we have imbalances there as
well okay so Let me actually

quickly use the replay tool
because this might be a better

visual.

Okay so you know what? Let me
take it back a little bit

further to right here.

Okay so price reacted to
something here probably far to

the left on a higher time frame
reacted to a demand level there

started trading higher hasn't
broken any structure yet

obviously we kind of topped out
here created supply headed back

down created a low and then
very impulsively took off to

the upside didn't break
structure just yet with that

candle but shortly after it did
break structure right there so

this is the important part
where we have to locate our

imbalance okay Because we broke
structure. Right? BOS breakup

structure. What was responsible
for that breakup structure?

Well this order block was
responsible for that that was

the last low volume point of
interest sorry that was the

last it was the point of origin
for this break of structure it

was the last low volume candle
prior to the volume disrupting

the market and breaking
structure right like I've said

in previous videos doesn't
matter if it's bullish or

bearish what matters is that
it's the low volume candle so

rather than setting our order
block to this huge bearish

candle we can refine it down to
the small bullish candle

doesn't matter if it's bullish
or bearish okay so this is our

order block again let's label
one hour OB, one hour order

block. Now this order block is
even more valid than another

order block would be because it
actually created imbalance. Now

I hope you can spot the
imbalance based on what we went

over up here. The imbalance is
we just move this away for a

second. It's the gap between
this wick and this wick. Okay.

Now, there wouldn't be an
imbalance if this wick right

here was able to trade down far
enough and connect with this or

go past it but that's not what
happened. There was a gap in

price. So, only buyers were in
control, right? There's a gap

in price. There's no
equilibrium. There's no balance

between buyers and sellers
creating an imbalance, alright?

Let's put our order block back
there.

Okay so we know that we have a
valid order block here it broke

structure okay and we have
imbalance here as well so that

creates a higher probability
scenario that this order block

will be mitigated and continue
bullish order flow from that

point on okay so we could
certainly look at placing a

long position here and that's
exactly what happens price taps

into the auto block clears the
or sorry corrects the imbalance

slash inefficient price action
clears that mitigates the order

block about 50% of the order
block too which is nice and

then takes off from there okay
look at that so that would have

been a beautiful long position
as well and you could even you

know once you enter a long
position here your targets

could be set at the 1 hour
order block up here because we

also have good understanding
that price should reach back to

that level because of the
imbalance here okay so rather

than let me just map this out
for you quickly so you

understand what I'm talking
about set an entry at the open

of the order block for example
stop loss just below now

instead of just simply
targeting our profit for the

recent highs like this high
here for example or even this

high here you know that would
still present a good

opportunity 5% to that high you
know just over five and 1/ 2%

to that high but we know
there's imbalance here so it's

a very likely scenario that
price is going to eventually

reach the order block up here
right so we could target that

order block at least the the
low of that order block now

that changes things into 8. 66
R rather than five R okay and

we already saw this previously
but you know it's played out

anyways price does reach that
order block okay from there

we'd be going short right
because we you know we have a

valid block.

Stop loss just above. Target
lows. You can target this low.

Right? So there's I'm not
going to go through the whole

trade. That's not the point of
this. But the point is we can

use imbalance and inefficiency.
We can use our knowledge of

that to strengthen our bias for
our order blocks okay. Locating

order blocks and breaks of
structure. That's a whole

different thing. We've gone
over that previously. But

imbalance is just another tool
in the shed to use towards

strengthening our bias. And you
can see how beautifully that

can be utilized right? We can
take advantage of the market in

in completely different ways
with complete confidence. By

utilizing this knowledge.
Alright so I hope hope you guys

enjoyed this video. Um I hope
it wasn't too long. I hope I

didn't ramble too much but you
know I'm sure there was some

really good points that you
guys can take away from this.

So yeah. We'll talk to you guys
soon. Stay tuned for the next

one.