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Smartmoneyconcept

How to work with liquidity grab?Hello everyone👋 Today we will discuss how to effectively work with areas of increased liquidity. Actually, it would be appropriate to make this post after we have examined how order flow is formed in the market in order to understand the technical aspect of working with liquidity. Therefore, first, we will provide some introductory information using a long position as an example. When a trader buys an asset, they usually set a stop loss at a certain level or, if they don't use protective orders, their position will have a liquidation price depending on the chosen leverage. Based on this, when a specific price level is reached (stop loss or liquidation), their asset will be sold with a market order that will match the nearest limit order. Hence the conclusion: any exit from a losing position, as described above, is someone else's entry into a position with a limit order, often at a favorable price. This is how the positions of all major market participants are accumulated. So, we simply need to estimate where the maximum number of active stop losses is located and make a trading decision based on that. Most often, stop orders are located in the following zones: 1️⃣Obvious levels with equal highs/lows. 2️⃣Above/below any high/low in an obvious trend. After identifying such zones using our indicator or independently, you can take trades in the direction of liquidity grab (counter-trend trades with high potential but also high risk) or wait for actual liquidity grab and confirmation to enter a trend trade. In the next post, we will explore the technical aspect of liquidity grab for a deeper understanding of the topic. We look forward to your questions. Happy trading!
Education
by PhantomFlow
The Art of Smart Money Trading: Bank and Institution StrategiesThe realm of finance is replete with a plethora of phrases and terminology, and among the most prevalent is the notion of "smart money." This term commonly alludes to seasoned traders who possess access to a wealth of information and knowledge beyond the reach of novice traders or individual investors. Within the domain of cryptocurrency, the concept of smart money often pertains to significant institutional investors, banks, hedge funds, and corporations that engage in market investments. This comprehensive article aims to delve into the origins of the smart money concept, elucidate its pertinence to trading practices, and expound on how banks employ smart money strategies to generate profits. Additionally, we shall closely examine the three fundamental phases that constitute a bank's trading strategy: accumulation, manipulation, and allocation. The concept of smart money has its roots in the recognition that certain market participants possess a distinct advantage due to their extensive experience, robust networks, and access to specialized information. These seasoned individuals or entities are deemed to possess a higher degree of expertise, enabling them to make astute investment decisions and exploit market inefficiencies more effectively than the average trader. In the realm of cryptocurrencies, the presence of smart money often exerts a significant influence on price movements and market trends. Large institutional investors, such as banks, hedge funds, and corporations, are typically considered as the primary bearers of smart money within the cryptocurrency landscape. These entities have the financial resources, expertise, and infrastructure to conduct extensive research, employ sophisticated trading strategies, and execute substantial transactions in the market. Their actions and decisions often carry substantial weight and can sway market sentiment, prompting other market participants to follow suit. Banks, in particular, leverage smart money strategies to capitalize on market opportunities and generate profits. Their trading strategies encompass three distinct phases: accumulation, manipulation, and allocation. During the accumulation phase, banks discreetly amass positions in a particular cryptocurrency, taking advantage of lower prices and limited market awareness. This phase allows them to build substantial positions without significantly impacting the market. Following accumulation, banks proceed to the manipulation phase, wherein they employ various tactics to influence market sentiment and price movements. These tactics can include spreading rumors, initiating coordinated buying or selling actions, or employing technical analysis techniques to trigger specific market reactions. By skillfully manipulating market dynamics, banks aim to generate favorable price movements that benefit their accumulated positions. Finally, during the allocation phase, banks strategically distribute or liquidate their holdings to maximize profits. This phase entails careful execution and timing to ensure optimal returns. Banks may employ a range of trading techniques, such as scaling out of positions gradually or employing algorithmic trading strategies, to efficiently allocate their holdings while minimizing market impact. Understanding the dynamics of smart money and how banks utilize smart money strategies provides valuable insights for individual traders and investors. By monitoring the actions of these institutional players and comprehending the phases of their trading strategies, market participants can potentially identify trends, anticipate market movements, and align their own trading decisions accordingly. What Is Smart Money? The concept of smart money originated from the gambling industry, where less experienced players would bet on the winnings of more experienced players. In the trading world, the creator of the smart money strategy is trader Michael Huddleston, also known as the Inner Circle Trader (ICT). According to Huddleston's theory, the cryptocurrency market is predominantly controlled by big players who are seasoned trading professionals. These individuals determine the asset's price and the direction of the current trend as they operate with significant volumes of invested funds. Their behavior is considered "smart" due to their experience, awareness, and often access to important insider information, contrasting with the "dumb money" formed by inexperienced traders who lack crucial market insights. For instance, a study conducted by BDC Consulting in August 2021 revealed that major market players and professional investors hold approximately 42.66% of all existing Bitcoin tokens. This means that almost half of the coins are managed and regulated by individual companies, renowned personalities, hedge funds, and other entities seeking to profit from cryptocurrencies. Examples of smart money traders include large banks like JPMorgan Chase and Citibank, central banks, hedge funds, and prominent institutions such as insurance companies and global corporations. The smart money strategy primarily involves analyzing the behavior of these significant market players. The core principle of the strategy is often summarized as "follow the smart money." Understanding and utilizing this strategy in trading is essential due to the influence of powerful investors on price movements. One of the main mistakes made by traders is neglecting this factor and solely relying on technical analysis. However, it is important to recognize that major market players are also familiar with these technical analysis algorithms and can anticipate how traders will react in specific market situations. Consider the following example: Intraday traders identify a triangle pattern on the chart, characterized by converging price ranges forming an angle towards a single point. Based on their analysis, they anticipate an upward rally with a breakout above the upper boundary. However, the price unexpectedly bounces downward, only to recover its upward movement after a certain time interval. Such price behavior can be interpreted as the intervention of big players who were able to profit from the situation and force traders to close their positions due to stop losses. Trading Strategies Of Banks Trading strategies employed by banks involve several phases to maximize their profits in the forex or other markets. One commonly used strategy can be divided into three distinct phases. Phase 1: Accumulation The first phase is crucial for banks and serves as the foundation for the subsequent steps. Banks cannot enter a trade with their entire capital all at once, especially when they aim to create a significant market movement in their desired direction. This approach prevents retail traders from simply copying the banks' trades, which could lead to long-term issues. To address this, banks accumulate entry points for long or short positions over a period of time. They strategically make small purchases or sales, depending on the market direction they seek to stimulate. For instance, if the banks aim to initiate an uptrend, they open numerous long positions at intervals of hours or days. While retail traders may perceive the market as consolidating or moving within support and resistance levels, they are actually witnessing the actions of the big players building their positions. Phase 2: Manipulation The second phase involves market manipulation, which can take various forms and is often known by terms such as "false breakout," "false push," "hunt stop," or bull/bear trap. During consolidation periods, retail traders frequently place pending trades above or below the consolidation zone, hoping to capture a breakout when it occurs. However, the banks strategically create false breakouts, triggering the activation of these trades and then abruptly reversing the direction, triggering stop losses. This manipulation is a key reason why many retail traders lose money. Retail traders often lack effective breakout trading strategies and fail to consider where most traders have placed their stop losses. This lack of awareness makes them vulnerable to the banks' manipulation of the market, resulting in losses. Phase 3: Allocation The third and final phase is allocation, where banks make their last significant push in the desired direction. Their previously hidden positions become evident, creating potential profit opportunities for retail traders. As the market begins an uptrend and retail traders try to follow by opening buy trades, banks employ a contrarian approach. They sell when the crowd is buying and buy when the crowd is selling. This contrarian trading strategy allows banks to accumulate positions in preparation for a new trend that typically moves in the opposite direction. At this stage, the price may enter an overbought or oversold area, indicating an imminent reversal. It is a critical moment for traders to be cautious and consider the banks' contrarian actions, as it signifies a potential shift in the market trend. Applying Smart Money Strategy One of the most popular strategies in smart money trading is the identification and utilization of Order Blocks. This strategy is based on understanding how banks and investment firms execute their trades in the market. When major players wish to buy or sell large volumes of an asset, doing so in one trade would significantly impact the asset's value, potentially reducing their profitability. To mitigate this, they often use order blocks to distribute their trades more evenly in the market. Regular traders also benefit from this feature as it influences the price but in a more balanced manner than if the major player executed their trades all at once. On a Japanese candlestick chart, the starting point for placing an order block is a price pattern where the subsequent candlestick in a strong impulsive movement completely overlaps the previous one. For example, at the beginning of a bearish trend, a red candle overlaps a green one, and vice versa for a bullish trend. The order block zone often becomes a level to which the price tends to return after all the orders have been closed, providing potential trading opportunities. In practice, the placement of an order block can serve as a signal for an impending reversal when the price reaches its peak. Depending on the color of the candle that initiates the order block, traders can open a long or short position, with green indicating an upward movement and red indicating a downward movement. Smart money trading also involves the use of other price patterns, such as: Imbalance or Fair Value Gap: This candlestick pattern depicts a rapid and significant price movement, either up or down, without opposing orders. It occurs when there is an absence of sell trades during an upward impulse or buy trades during a downward impulse. The area where the price moved too quickly becomes a level where the price is likely to return in the future. Breaker Block: This pattern indicates that the price has surpassed the order block level. It can appear on the chart as a strong impulse candlestick that disrupts the existing price structure, potentially leading to a significant shift in the market. By understanding and applying these price patterns and the concept of order blocks, traders can align their strategies with the actions of smart money participants and potentially improve their trading outcomes. Example of Smart Money Concept chart. Criticism Of Smart Money The smart money strategy faces criticism from experienced traders who question its validity and practicality. One major criticism is that the strategy is based on postulates that are difficult to prove. It is argued that the notion of major players seeking to manipulate ordinary traders lacks concrete evidence. Additionally, the specific strategies employed by large investors and companies in the market are not clearly defined, and obtaining this information is challenging, often requiring insider knowledge that may not be readily available. Furthermore, the smart money strategy is sometimes viewed with skepticism due to its complexity and the use of specialized terminology that differs from standard trading language. This complexity can be overwhelming for beginners, potentially hindering their understanding of other trading strategies. Moreover, since the smart money strategy originated in the traditional currency market, there are doubts about its applicability to other markets such as cryptocurrencies or stocks. However, it should be noted that there have been instances where the strategy has been successfully applied in these markets, debunking some of these doubts. Overall, while the smart money strategy has its proponents, it is not without its critics who raise concerns about its empirical foundation, complexity, and applicability across different markets. Traders should carefully evaluate and assess the strategy's principles and techniques before incorporating them into their own trading approach. Advantages And Disadvantages Of Smart Money Strategy The smart money approach in trading offers several advantages, but it also comes with certain disadvantages. Let's explore them in more detail: Advantages: Reduced risks: Following the movement of smart money and basing trading decisions on it can help reduce risks. When traders accurately identify the actions of large investors, there is a higher probability of successful trades and lower chances of incurring losses. Stability: The smart money strategy focuses on steady income rather than quick and large profits. It can provide a reliable and consistent approach for investors who prefer a more stable investment strategy rather than making short-term market forecasts. Confidence: The concept of smart money can provide psychological comfort for many beginner investors. By aligning their trades with the actions of experienced and knowledgeable market participants, they may feel more confident in their investment decisions. Disadvantages: Reduced liquidity: One potential drawback of the smart money approach is that when large amounts of capital move in one direction based on the actions of major players, it can impact the liquidity of the asset. This can make it more challenging to enter or exit trades at desired prices, potentially leading to slippage or limited trading opportunities. Speculative bubble risk: Following the movements of smart money can sometimes lead to speculative bubbles. In such cases, the interest in an asset is driven not by its inherent value but by a pattern of behavior among market participants. When the bubble reaches its maximum point, it can burst, causing a sharp decline in the asset's price. It is important for traders to consider both the advantages and disadvantages of the smart money approach and assess their risk tolerance and investment goals before incorporating this strategy into their trading decisions. Conclusion The smart money trading strategy revolves around analyzing the actions of major players in the market, such as banks, hedge funds, central banks, and large institutions. It is crucial to grasp the fundamentals of this strategy to avoid solely relying on technical analysis and to align your trading approach with the movements of smart money traders. Smart money traders follow a well-defined trading strategy that encompasses three key phases: accumulation, manipulation, and profit-taking. During the accumulation phase, these traders accumulate positions gradually to avoid significant market impact. In the manipulation phase, they may employ various tactics, such as false breakouts or stop hunting, to manipulate the market and catch retail traders off guard. Finally, during the profit-taking phase, smart money traders exit their positions and capitalize on their accumulated profits. For retail traders, it is essential to learn how to identify and follow the trend established by smart money players. Understanding their behavior can provide valuable insights into market direction and potential entry and exit points. Additionally, using stop losses effectively is crucial to protect trades from unexpected market moves orchestrated by smart money traders. Remember that comprehending the operations of smart money traders is a significant factor in achieving success as a trader. By studying their strategies and actions, retail traders can enhance their decision-making process and improve their overall trading performance.
Education
by FOREXN1
22
📊 Smart Money Concepts: A Market Structure Showcase 📍What Is Smart Money? Smart money is the capital that is being controlled by institutional investors, market mavens, central banks, funds, and other financial professionals. Smart money was originally a gambling term that referred to the wagers made by gamblers with a track record of success. 📍Principles of Smart Money Market Structure in Order Block Trading Price moves within a structural of support and resistance. A breakout of the structural of support or resistance will lead to price movement in the next area of the support or resistance. When the price broke market structure was high the low point becomes a strong low. Strong Low is The Low that caused Manipulation and Break Structure (resistance). Fresh high in an uptrend and fresh low in a downtrend. Weak Low/High is the Low that fails To Break Structure 🔹For every strong LOW, there is a weak High 🔹For every strong High, there is a weak Low After a zone is tested many times or during a strong move, Supply and Demand levels eventually break. Due to the remaining orders being triggered and gradually removed, or an overwhelming number of orders in the opposite direction breaking the level. 👤 @AlgoBuddy 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
Education
by QuantVue
10
📊Liquidity GrabSmall and big players tend to acquire larger positions in the market than they can afford, in an attempt to benefit from the leverage. This is where the concept of liquidity grab comes into play. Large trades and institutional investors need to locate liquidity areas in the market to complete their trades. Stops and stop-loss orders are critical for survival in a leveraged market. Stop hunting is a common practice in Forex trading, where traders are forced to leave their positions by triggering their stop-loss orders. This can create unique opportunities for some investors, which is called a liquidity grab. Stop hunting is a trading action where the price and volume action threatens to trigger stops on either side of support and resistance. When a large number of stops are triggered, the price experiences higher volatility on more orders hitting the market. Such volatility in price generates opportunities for participants to enter a trade in a favourable environment or protect their position. The fact that too many stop losses triggered at once result in sharp moves in the price action is the reason behind the practice of liquidity grab. 📍 What is liquidity sweep? In trading, a liquidity sweep is the process of filling an order by taking advantage of all available liquidity at multiple price levels. Traders use this method to ensure their orders are filled at the best possible price by breaking up their order into smaller sub-orders and spreading them across multiple price levels. Institutional traders and high-frequency trading firms commonly use liquidity sweeps for efficient and quick execution of large trade volumes. 📍 Liquidity Zones Big players in trading aim for the best prices but face challenges finding sufficient counter-forces to fill their large orders. Entering the market at low liquidity areas creates more volatile markets, negatively impacting the average price. Conversely, entering at high liquidity areas results in less volatile markets, ensuring a better average price for the position. These liquidity zones are where stop-loss orders are placed, and the concept of "liquidity grab" comes from the need for big players to enter the market in these zones to take large positions. Traders use swing lows and swing highs to create these liquidity zones and place stops as reference points, resulting in either a reversal to the mean or a breakout of the level. 👤 @AlgoBuddy 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
Education
by QuantVue
21
EXPLAINED: A Bullish Fair Value Gap (FVG) - Smart Money ConceptsA Bullish Fair Value Gap is a 3 candle structure with an up impulse candle (2nd) that indicates and creates an imbalance or an inefficiency in the market. WHAT DO THE IMBALANCES TELL US? These imbalances tell us that the buying and selling is not equal. Now the market needs to rebalance (move at least to 50% of the fair value gap to fill) to make up for the imbalance and rebalance. For this to happen we need to see orders filled in the prices of the candle with the FVG. HOW A BULLISH FAIR VALUE GAP IS CONSTRUCTED: 1st Candle Draw a horizontal line from the top of the wick. 3rd Candle Draw a horizontal line from the bottom of the wick 2nd Candle Draw a BOX between the above and below and pull it over to see the FVG range. BETWEEN CANDLE 1 and CANDLE 3: Do NOT show common prices. They do NOT touch where the upper & the lower wicks do NOT overlap. With a Bullish FVG we can expect the market price to move DOWN. HOW MUCH? I believe a Bullish FVG needs to close at least 50%. So you can drag a Gann Box or a Fib retracement (take out all the other levels except 50%). Wait for the price to close and fill the prices and boom - Your Bullish Fair Value Gap has been filled. Let me know if you have any other SMC (Smart Money Concepts) Questions.
JSE:BVTEducation
by Timonrosso
1
6 Rules of Successful TradersI’ll tell you this. The money you desire, is not going to just fall into your lap. If you want to be a successful trader, you need to write down the ground rules to get your as$$into gear. I can’t profess for every professional trader, but I can share with you my rules I’ve been following for the last 2 decades. Feel free to write them down for your trading. RULE 1: Always have a trading plan This is a must. The financial markets are dangerous. Once you enter them, you are playing with the big boys. If you go in blindly or naked (without risk levels in place), prepare to be caught with your pants down. You need your game plan in front of you at all times. There needs to be criteria you’ll follow from when you switch on your computer to when you close it. RULE 2: Don’t procrastinate Trading is like waiting for the next train. Wait too long and you’ll miss your train. You’ll then have to wait an unnecessary extended period of time for the next one. When your trading plan fires a signal – FIRE. When your trading plan fires an adjustment move – FIRE. You are only fooling yourself, if you don’t act when you need to. RULE 3: Be patient There are two important factors to patience. First, never rush into getting into a trade for the thrill, excitement or revenge! Second, never rush at getting out of a trade if it has not hit one of your trading levels. Patience is where you will grow your portfolio. Say that out loud… Patience is where you will grow your portfolio. RULE 4: Take the trade If I made a T-Shirt I think I would have one just saying. “Just take the trade” Repeat after me! If all is lined up and ready to go. It doesn’t matter what fundamental factor or news event is going on. It doesn’t matter how you’re feeling or that you have a headache. Just take the trade when your plan tells you to. It will take you 30 seconds. Then close your laptop and go rest. RULE 5: Keep learning With technology advancing, financial instruments changing, market dynamics shifting and with the world evolving… You need to keep learning and updating your knowledge base. You never know if the new developments, will lead to a higher win and success rate. You never know if your system and trading will be optimised and maximised to a better performance, The onus is on you to keep up with learning… RULE 6: Don’t give up We all have our own time lines with trading. We are all on our own journeys, challenges and struggles. You only lose when you quit. So please, I beg you, don’t give up and you will thank me later… Let’s sum up the 6 rules quickly for you… 1. Always have a trading plan 2. Don’t procrastinate 3. Be patient 4. Take the trade 5. Keep learning 6. Don’t give up
TVC:SA40Education
by Timonrosso
📊 Smart Money Concepts | Supply & Demand🧐What is Smart Money? Smart money refers to the capital that institutional investors, central banks, and other professionals or financial institutions control. It is managed by expert investors who can foresee market trends and make most of the profits. Smart money was originally a gambling term, where it refers to the gamblers that have extensive knowledge of the activity that they wager on or have insider information that the common public is not able to access. The smart money concept suggests that these investors can identify trends and opportunities before the broader market and position themselves accordingly. They may also be able to manipulate the market to their advantage by creating buying or selling pressure on certain securities. Some traders try to follow the smart money by analyzing the actions of these large investors through public filings, news reports, or other sources of information. However, it is important to note that not all trades made by institutional investors or large financial institutions are necessarily "smart," and blindly following their actions can be risky. 🔹 Supply Zone In trading, a supply zone is a price range where there is an abundance of sell orders, resulting in increased selling pressure and potentially a temporary resistance level. A supply zone can be identified on a price chart as an area where the price has previously reversed or stalled, and where there are many unfilled sell orders or pending sell orders. Traders may use supply zones as a reference point for making trading decisions. For example, if the price approaches a supply zone, traders may consider selling or taking profits on existing positions. Conversely, if the price breaks through a supply zone, traders may see it as a bullish signal and consider buying or adding to long positions. 🔹 Demand Zone In trading, a demand zone is a price range where there is an abundance of buy orders, resulting in increased buying pressure and potentially a temporary support level. A demand zone can be identified on a price chart as an area where the price has previously reversed or found support, and where there are many unfilled buy orders or pending buy orders. For example, if the price approaches a demand zone, traders may consider buying or adding to long positions. Conversely, if the price breaks through a demand zone, traders may see it as a bearish signal and consider selling or taking profits on existing positions. 👤 @AlgoBuddy 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
Education
by QuantVue
34
Smart Money Concept - TerminologyToday i would like to share full list of basic terminology Smart Money Concept To all newbies this list will be useful HH (Higher High) - high maximum HL (Higher Low) - high low LH (Lower High) - low high LL (Lower Low) - low minimum Fib (Fibonacci) PDH is the high of the previous day. PDL is the low of the previous day. PWH is the high of the previous week. PWL is the low of the previous week. DO - opening of the day. WO - opening of the week. MO is the opening of the month. YO - discovery of the year. TF (TF) – timeframe MN (Monthly) - monthly W (Weekly) - weekly D (Daily) - daily H4 (4 hours) - 4 hours H1 (1 hour) M15 (15 minute) - 15 minutes M1 (1 minute) MS (Market Structure) - market structure BOS (Break of Structure) MOM (Momentum) - momentum. Time difference between impulse and corrective wave HTF (Higher Time Frame) LTF (Lower Time Frame) – lower timeframe RSP (Real Structure Point) - key structural point PRZ (Price Reversal Zone) – price reversal zone CPB (Complex Pullback) RR (Risk:Reward) – risk/reward TGT (Target) SL (Stop-loss) - stop order BE (Breakeven) - breakeven PA (Price Action) - price movement Liq (Liquidity) – liquidity EQH (Equal Highs) - equal highs EQL (Equal Lows) - equal lows SMC (Smart Money Concept) - the concept of smart money DD (Drawdown) - drawdown Be (Bearish) – bearish trend Bu (Bullish) – bullish trend HNS (Head and Shoulders) - head and shoulders IT (Institutional Traders) - institutional traders CO (Composite Operators) - composite operators WHB (Weak Handed Buyers) - Weak Buyers WHS (Weak Handed Sellers) - Weak Sellers DP or POI (Decision Point) or (Point of Interest) - decision point or point of interest IMB (Imbalance) - imbalance SHC (Stop Hunt Candle) OB (Order Block) - block of orders OBIM (Order Block with Imbalance) - a block of orders with an imbalance OBOB (Lower timeframe Order Block with a higher timeframe Order Block) – LTF order block in the HTF order block zone WKF (Wyckoff) PS (Preliminary Support) - preliminary support PSY (Preliminary Supply) - preliminary offer SC (Selling Climax) - Selling Climax AR (Automatic Rally) - automatic rally ST(Secondary Test) - secondary test SPR (Spring) - the final position by a major player, followed by the liquidation of the last players in the market Test (Test) SOS (Sign of Strength) - a sign of strength SOW (Sign of Weakness) - a sign of weakness LPS (Last Point of Support/Supply) LPSY (Last Point of Supply) - the last point of the offer BU (Back-up) - price return to the range to cover the imbalance JAC (Jump across the creek) is another name for SOS UT (Upthrust) - the primary move out of the range to capture liquidity TR (Trading Range) – trading range WAS (Wyckoff Accumulation Schematic) WDS (Wyckoff Distribution Schematic) WICK - a candle with a long shadow, which removes liquidity, stops. A squeeze is a rapid rise or fall in prices. Range - sideways price movement in a certain period without updating highs and lows. Deviation (deviation) - a false exit, beyond the boundaries of the range. EQ - (equlibrium) - the middle of the range. TBX is the entry point. Take Profit - take profit. STB - sweep (manipulation) of liquidity, the sale of an asset before growth. BTS - sweep (manipulation) of liquidity, the purchase of an asset before the fall. AMD (accumulation manipulation distribution) - accumulation, manipulation, distribution ( distribution) Hope you enjoyed the content I created, You can support with your likes and comments this idea so more people can watch! ✅Disclaimer: Please be aware of the risks involved in trading. This idea was made for educational purposes only not for financial Investment Purposes. --- • Look at my ideas about interesting altcoins in the related section down below ↓ • For more ideas please hit "Like" and "Follow"!
BITSTAMP:BTCUSDEducation
by Crypto4light
2
Pure trendline breakout strategy; Manticore Investems Pure trendline break strategy is based on indicators: Tradelines with Breaks (FREE) - TwB Position entry signals, trendline breakout. We look for signals on the ~h4 interval. We take a position on lower intervals when we see entry signals there as well. Order block Detector (FREE) - ObD Generates us support and resistance for the price (red - sell, green - buy) Pivot Based Trailing Maxima & Minima (FREE) - Pbt Helps determine the current trend of the market on a given interval, serves as an add-on informing us about market trends. In the green zone - buy, red - sell. SuperOSC (FREE) - sOSC Informs us about the strength of the market at a given moment (on a specific candle) In addition: LuxAlgo Price Action Concept (PREMIUM). Strategy description: Basically we trade after large signals generated on h4/d1 intervals. When we take a position we look for the optimal place to enter from m15-h1. We use resistances and supports as SL/TPs. Trading style: scalping / daytrading. Ideal entry setup: 1) Signal generated on the h4/d1 TwB interval. 2) ObD secure our position / ObD do not interfere with a potential sell or buy 3) The trend set by Pbt agrees with the direction we are playing. (Green zone - buy / Red zone - sell). 4) The candle after which we enter is not drawn on the sOSC Examples below: H4 interval buy signal: 1) Pbt - Green buy zone 2) TwB - upward signal 3) sOSC - the candle that generated the buy signal did not cross the dashed lines When we take a position we go down to lower intervals to best estimate SL:TP H1 interval: H1 interval buy signal: 1) Pbt - Green buy zone 2) TwB - upward signal 3) sOSC - the candle that generated the buy signal did not cross the dashed lines Estimation of risk and timing of exit: Risk estimation: 1) We use ObD to determine the optimal risk, they serve as resistance to the price. 2) We set positions below the buy / sell zones from Pbt 3) We go to lower intervals, set SL under the TwB level of the opposite trendline Determining take profit: 1) We play out positions to supports or resistances generated by ObD 2) We close the position when we see that after the close of the h4/h1 candle the sOSC is drawn above or below the dashed line 3) We can close positions when we see that the movement is losing strength and there are opposition signals to our position on low intervals. It works best to close positions after reaching ObD supports/resistances in conjunction with a drawn-out sOSC. LuxAlgo Price Action Concept indicator (PREMIUM), serves as an aid in determining the strength of a given support or resistance (the higher the %, the stronger the resistance)
BITSTAMP:BTCUSDEducation
by Manticore_Investments
2
QML pattern Quasimodo | SMART MONEY CONCEPTHello all. Today we will talk about the reversal pattern "Quasimodo" or QML. Schematically it looks like this: The price moves in the trend, in POI the structure breaks and after that, the price can not update the previous HH and the downward movement continues (consider a schematic example). In this example, after the breakdown of the structure, the price reverses to soften and remove internal liquidity, after which a reversal occurs. This is done in order to close a losing position at the expense of those who put their stop losses behind the maximum of the substructure. There are many names for this pattern, such as three tap setup, but I'm more accustomed to calling it quasimodo. If you like, it's a reworked version of the "head and shoulders" pattern, but in this case you're focusing on the price action instead of the picture. Criteria for QML formation 1. Use it in HTF POI 2. Watch HTF POI 3.Watch the price action. 4. Premium or Discount zone To use the pattern effectively, you must analyze the chart of all TFs. And use the pattern as an entry model. For example, the daily TF is bearish. The price is in the premium zone, as well as on the H1 TF began an uptrend, a full of bullish trend in the lower TF, after which we see that the substructure (red) has changed from a rising to a descending. And thus, we expect a continuation of the downtrend. Important Don't use this pattern in terms of "drawing". They can draw anything on the chart. I recommend to look for POI in POI of higher TFs. An additional factor could be substructure fluctuations before FWG or OB. You need to see how the price behaves after their update. Where to put a stop loss The first option is a stop-loss for a local FVG/OB The second - above swing high of substrucutre Third - above the HTF point of interest, if your RR allows it EXAMPLE After updating the all-time high, the daily structure was broken. Then price consolidated, it was worth waiting for the manipulation. It was possible to enter from HTF POI - aggressive entry, but it was possible to wait for confirmation on the LTF (as I do). I'm expect bullish OF on 4H chart to HTF POI (2D ob) This "entry into position" is shown as an example, so that you can form an understanding of how to act in this or that situation. In conclusion, the more factors you take into account in your analysis, the higher the probability of working out of the pattern. Also, it's up to you to choose what kind of stop loss you will use. There is no right and wrong, everything depends on your strategy and money management. The position was opened after the second liquidity raid in the premium market. I hope it was helpful to you. Thank you for your attention
Education
by Patronofbargain
How Smart Money took out our liquidity- Trapped with 2 Change of Character (CHoCH) in order to signal a reversal in trend. - Took out liquidity along the way to original Order Block - Damn! they got our Long & Short stop loss. What to do: - Keep watching Price Action until we see Break of Structure (BOS) in smaller time frame. - Plot an entry based on newly constructed Order Block. - Price came right at discount zone of fib level perfectly. - GO with the real move at WAGMI entry point!
Education
by v_rapatt
3
Everything you need to know about order block 5 RULES | TUTORIALToday we're going to talk about orderblocks. Very simply, an orderblock is the support and resistance of big players. It is stronger and more important than what you draw on a chart expecting a price reaction by classical technical analysis. This works absolutely everywhere in cryptocurrency, forex, and the stock market. I have deduced for myself 5 rules of confirmation, and now we will go over each of them. Let's start with schemes and end with an example on a chart. Orderblock is a candlestick that shows purchases or sales of large capital. When a bullish orderblock is formed, an accumulation or reaccumulation takes place in order to further markup the asset. When a bearish orderblock is formed, a short position is accumulated or reaccumulated. With the purpose of further asset markdown. The first rule is liquidity. We have a zone from which the price gets a reaction and goes in the opposite direction. This forms a support zone for those who trade classic technical analysis. Traders place their orders in this zone, which is what the big capital hunts for. Accordingly, this level is pierced by the flow of orders, which activates these stops. This is how liquidity is removed from the area. The last bearish full-body candle will be our orderblock. It is important that it updates past lows. An analogy would be the wicks of candle, which removes liquidity from past lows. The wick of a candle in this case is an orderblock on a lower TF. The second rule is confirmation After withdrawal of liquidity we expect confirmation of this orderblock - that is absorption and movement in the opposite direction. The confirmation should be impulsive. That is, we should not see how the price is stuck in this confirmation. It concerns the absorption (updating) of the order block. It is possible inside the candle (orderblock). But personally, I try to take the "book variant". Local consolidations can indicate the weakness of the movement. It doesn't mean that the orderblock will not work out in the end, but the probability decreases. The third rule is structure breaking (bos) One of the key points is the breakdown of structure that this orderblock provides. This is how we can understand the mood of the market and the intentions of big capital. In this example, we can highlight the main structure with the yellow line. It is after updating a significant structural element that we can be almost sure of the truth of our orderblock. If we don't see a break in structure, then this movement may just be a correction within a downtrend. So keep an eye on this one. The fourth rule is the law of force (momentum) After confirming our orderblock, we can see a prolonged correction in the OTE (make a Fibo). That is, we should see an impulse and after it a slow sluggish movement downwards, which will also form liquidity behind each local high. This is not a necessary factor, but if it is present, the probability of a trend reversal will increase many times over. The fifth rule - the volume and spread of candles The candlesticks should be full-bodied with increased volumes. It will be important to monitor the "distance" that the price has done. All these factors will also indicate the veracity of the movement. This recommendation concerns more about swing trading, moments when the price is in a trend for a long time without a serious correction and test of the formed order block. Examples on the chart On the daily TF I marked a Sell to Buy move. I marked it this way because there were no warrant blocks to satisfy me on the higher timeframe. This area will act as a zone of interest. The structure on the Hourly TF looks like this. Consequently, we expect a confirmation of our orderblock through a break of the structure. The price entered the sell to buy zone and tested the order block, which was formed from the wick of the candle. We saw an impulse exit and watch the price go up sluggishly, forming liquidity behind each low. Therefore, we expect an orderblock test. I recommend backtesting on chart history to better understand how order block works. Thank you for your attention, I hope it was useful
Education
by Patronofbargain
5
Smart Money vs Retail traders (How to Think Like Smart Money)😱 There were a few people there talking about their losses, that they had no idea what to do and I wrote this to them: It's mostly the fault of mainstream media + youtubers + twitterers etc. It's really easy to communicate the simplest approach that everyone understands and subscribes too. Note that if everyone is on the same side... Usually most people are wrong. They take past events too much at face value. But the market is constantly changing. Its to buy on the upside and not during pullbacks + HODL HODL HODL. With that said they really have no idea where they should get out and get in. That's fine by the way. News can be picked up by any of us from the news portals. They don't inform anyone about the negative side of things. It's a tough place to be and you can't take it half as seriously as it is communicated. Unless you are an investor (REAL) you are looking at the market long term. A multi-year perspective. Of course it doesn't pay off here either. The crypto market is still pretty damn small. No one is too late. Now most of you are losing time, but everyone has to start somewhere. I was in the same situation in 2017. I was drowning. Now I'm still looking at these corrections from + xxxxx% profit. Unfortunately we have to give ourselves time in the market and endure pullbacks of -20-30-40-50-60% to see 3000% profits. Realizing upwards during the upswing is not a bad thing. For me, a huge part of my strategy is to have a lot of money on the sidelines. That's why. Especially on 4H trend changes I sell everything that is not bullish. Then I sell others too if they break the trend and just trade. 💡 We are in the best market in the world, but psychologically the hardest market. If you learn to manage these things and use volatility to your advantage rather than your disadvantage, then it's a game changer. 💡 Institutions (fund managers, pension funds, banks and whales) think in long term horizons and monitor price action based on that (Years, Decades) Small investors, retail traders monitor things in low time frames (Minutes, hours, days). Small investors quickly switch between optimism and pessimism based on current price movements and news in the media. It can be a bull market one day and a bear market for a small investor the next. Institutional investors are not sentimental, they assess the growth rate of the market sector, the total market size available, the adoptation/acceptance, the growth of the network, the analysis of revenues (to predict profitability years and decades in advance). If an institutional investor draws a conclusion, they hold it until the underlying financial situation changes. Small investors usually have limited money to invest, so they often resort to leveraging, which typically results in full liquidation. Leveraged trades have "unlimited" potential losses, and therefore small investors (who do not like to buy spot because it is not "cool") can easily "drop out" of trading because of the "unlimited" losses from leverage. Think about it... as a retailer, you have your precious and hard-earned money on the line. Do you have time to lose what you've worked hard to earn, or even more? Why can't you accept that this is a profession? We study in university for 3-10 years to get an average salary afterwards. But here we are not willing to spend a couple of years without constantly taking time away from yourself with losses? Levrage are not bad. The user is the dangerous one. 😱 There is a reason why 90% of retail traders lose money. 💡Institutionalists brazenly exploit those with few resources and fear. Institutional investors have access to billions of dollars worth of resources and have teams of quantitative/statistical experts who control the automated trading algorithms. Institutional investors have deep pockets and can influence the general sentiment of the market through the press (news, social media and interviews). Institutional investors influence the news that small investors read. Institutionalists are well known for advertising higher prices to retailers to "buy at the top", This is the FOMO factor (Fear of Missing Out). They are also notorious for creating tremendous market fear (FUD - Fear Uncertainty and Doubt), which encourages retailers to "sell at the bottom". 💡 Institutions are also actively involved in futures, options and derivatives markets. They all actively benefit from short-term price cycles as well as longer-term accumulation strategies. The institutions are sophisticated, financially strong and have expertise. Institutions make money by attracting small investors into the market (via FOMO) and then liquidating their positions (via FUD). In the market, one person's loss is another person's gain. 💡 There is a learning curve that 90% of your people want to skip and get rich overnight. Unfortunately, this is not reality. Knowledge is incredibly important. If you want to be a doctor, or a surgeon, you don't just walk into the operating room and say give me a knife and I'll cut this guy open and operate him without any knowledge. You really have to know what you're doing. If you're an engineer or you want to be an engineer, without training or knowledge, it would be very difficult for you to build a bridge or a skyscraper. You need the knowledge. If you want to be a teacher, but you don't know the subject matter, it would be very difficult to teach students in a meaningful way if you don't even know what you are teaching. So it is essential to acquire knowledge, but that knowledge has to come from the right people. So mentoring is also vital. Everyone must also understand the psychological aspects of investing and trading. Because a lot of people lose money in the financial markets. Not because they are stupid, but because their emotions get the better of them. Focusing on learning is incredibly important, it changes your life. Of course, this doesn't just apply to investing and trading. It applies to everything, which is why the financial markets are so incredible in their ability to create meaning in life, if people are open to it, and if they don't focus too much on money, then money will simply be the result of doing things the right way. Over time, if you do things the right way, you will become rich, you don't have to become a millionaire overnight. If you want to do that, you will probably lose all the money you put into the hands of institutions that want your money, want you to be captivated by a fantasy world. The reality is that you need the knowledge to fight the big players and win. 💡Self-control is also a must. All wealth will pass without self-control. Self-control makes you keep the money you earn. There are many examples of this among people who have won huge amounts of money without earning it. For example, people who win lottery. These people basically give back all the money they made because they didn't really earn it. A lot of times, the money they didn't earn is put back. When you earn money with self-control, you never have to give it back! It is yours and will continue to grow. 💡 The key is to get off your ass and get moving. Remember these things and you'll be fine.
BITSTAMP:BTCUSDEducation
by CryptofolioHungary
10
Smart Money Manipulation 🥊Alkaline is back baby! 💣 As smart money concepts gain popularity, liquidity increases. I have taken a month away from trading to study the new forms of market manipulation and have been pleasantly surprised by what I have found. Here is my discovery: 1) The market is currently focusing on taking liquidity from breakeven positions over fixed stop losses. This is because emotional traders put their stops to BE quickly to avoid pain, especially during indecisive markets. 2) Order blocks are the perfect manipulation areas. If you take time out to backtest significant order blocks, you will notice price will tap and lure or simply sweep above/below the zone before going in the intended direction. 3) That tight stop loss you are using is doing more damage than good. Scale into your positions, trust me when I say this will reduce your emotions and give you a more relaxed trading style. 4) Use your brain, even if you are in denial. If the majority of traders lose money, and the majority of traders now use smart money concepts, do the maths. It feels good to be back after a long month of studying, I have lots of new things to teach and share. I will be taking on new students shortly, have a great weekend everyone 👋
Education
by AlkalineFX
24