Lecture Notes on Price Action Model 5

Introduction

• Focus: Price Action Model 5 - Session Day Trading Model
• Deals with intraday volatility expansions
• Higher time frame liquidity draws for directional bias
• Setup: Intraday volatility expansions
• Pattern: Session swings with utilization of Power 3

Key Elements of the Model

• Directional Bias: Anticipating the movement direction (e.g., British Pound expected to move down to 130.54-130.55)
• Trading Sessions: Focus on trading individual sessions, not entire daily or weekly ranges
  • London Open Kill Zone
  • New York Open Kill Zone
• Preferred Days: Monday, Tuesday, or Wednesday for trading
• Flexibility: Can be used with other models for gap filling

Trading Strategy

• Intraday Volatility Expansions: Look for bullish or bearish scenarios within sessions
• Session Range: Seen as a candle range
  • Bullish Scenario: Target rejection block above market or buy-sell liquidity pool
  • Bearish Scenario: Target equal lows or sell-stop liquidity pool

Understanding Liquidity

• Daily Chart: Highlights probable liquidity draw
• Liquidity Pools: Consider previous highs/lows or intraday highs/lows for targets
• Standard Deviation: Use deviations to anticipate expansions

Tools and Techniques

• Central Bank Dealers Range: Use when range is clear and discernible, not trending, and above 15 pips
• Asian Range: Ideal above 20 pips, do not use if more than 40 pips
• Flout: Use when other ranges are not favorable; expand on range in multiples of 50%

Additional Insights

• Open Float and Time: Logical liquidity pools coupled with time of day
• Standard Deviation Expansions: Coupled with short-term liquidity pools for better accuracy
• Confluences: Combine time, standard deviation, and liquidity markers

Practical Application

• Example Used: British Pound vs. U.S. Dollar
  • Tuesday Setup: Trading the bearish order block
  • Volatility Expansion: Using deviation levels to determine trading points
  • Time of Day Considerations: Focus on kill zones for entry/exit

Important Considerations

• Trading Precision: Mask your trading precision to avoid broker issues
• Accuracy: Ideal to show around 70% accuracy to avoid raising red flags
• Confluence with Standard Deviation: Check overlaps with previous day's deviations for insights

Conclusion

• The model blends liquidity concepts with time and deviations to forecast intraday movements.
• Important to understand and practice using the framework for session trading and managing trades efficiently.

Caution

• Do not share specific chart setups publicly; maintain proprietary strategies to ensure continued efficacy.