Transcript for:
Trading Framework Overview

This guy has made over $10 million trading forex and cryptocurrency. This might sound blasphemy on this podcast and coming from me, but maybe you use Oh, wow. Now, we have all of the price action concept. I just saved you watching 12 months of ICT videos. I'm going to show you how to apply this. And what it's going to allow you to do is two super important things. It's one, it's going to help you determine your dream. A verified 8 figure ICT trader. It's the one and only trader mate. I'm going to be covering the framework for actually the entire strategy that I still use to this day. The strategy that I've used for several years now, your entry technique, which is just this. I'm sorry for any gurus that I've now ruined your thing. Cuz this is how a lot of guys teach people to trade. Today, he is going to break down the exact ICT concepts that he used to be able to achieve that result. What you're noticing here is ICT and other smart money guys sometimes like to really make some of these things seem complicated. They really don't have to be that complicated in practice. To make it even better, he has simplified it all down to make it simple, easy, and repeatable. No matter if you're a beginner or an advanced trader, ICT always says like, I want to know that the institutions are in this move. It's institutionally sponsored. Really, what does that mean? And it means that you're getting a Welcome back everyone to Chart Fanatics, the go-to channel for the very best strategy and concept breakdowns in the trading industry with the very best traders in the world. Talking of which, today we have our very first 8 figure verified trader on chart fanatics. He is an incredible crypto trader, but this strategy is actually universal whether you're futures, forex or crypto. And he's the co-founder of Breakout, the number one prop firm in the crypto space. It's the one and only Trader Mine. How you doing, man? Excited to be here. Thank you. I'm good. Well, let's get straight into it, man. So, I'm very, very excited. What are we going to be breaking down here on the whiteboard and what strategy are we looking at? Awesome. So, I'm going to be covering uh the framework for actually the entire strategy that I still use to this day, the strategy that I've used for several years now. So, what we're going to do is we're going to break down several different kind of complex price action concepts. I'll explain to you what they are. Uh, and the goal here is to help you identify high probability trading areas. Ultimately, the goal is to be able to increase your win rate. And I'm going to give you a framework that you're going to be able to easily apply into your charts, and you're going to be able to figure out things like trend, market structure, points of interest, different types of liquidity, external, external, draws on liquidity, as well as premium versus discount. So, if you're a smart money trader, price action trader, I know some of these concepts sound familiar to you. I'm going to break them down in a super visual, easy way that you're going to be starting to uh that you're going to be able to put into your charts right away. Love that. Let's get into it. Where do we begin? First thing that we're going to cover is actually all of the price action concepts um that you need to know to understand this strategy. And then once we understand these concepts, I'm going to put it all together for you and the trades you start taking going to be higher probability. So first thing we're going to talk about is just the three directions in which price can actually go. So when you are looking at a chart, price can really only ever do three things. Obviously an uptrend is the most obvious one, right? So price is consistently making higher lows, higher highs, easy visual to see. This would be considered bullish price action. The inverse of this would then be of course a downtrend. Right? Price is making lower highs, lower lows, and this would be considered bearish price action. So these are the two main trends for price. We can go ahead and wipe this away. The last thing price can do obviously is go sideways. So there's a lot of different terms for sideways price action. You could call it a consolidation. You could call it a range. You could call it reaccumulation or redistribution. So if price is in an uptrend, then it goes sideways, then it continues up. This would be accumulation or reaccumulation. What we're going to be focusing on here is trending environments. So either price making higher highs and higher lows, an uptrend, or lower highs and lower lows, which would be a downtrend. So let's assume for this example that we are in an uptrend. So price is making a low to a high to another low to another high. So it's consistently making higher highs and higher lows. So if you're a trader and you want to get in on this trend, what's the most optimal time to actually enter the trade? You could enter the trade here theoretically and if you're willing to hold all this draw down and you survive this draw down, you might end up making money when it trades back here, but in reality, the most optimal area to get into the trade is at those higher lows. And so what this framework and this strategy is going to help you do, it's going to help you find the most likely areas for these higher lows to occur. It's going to give you the best riskreward. It's also going to give you the best chance to find a high probability setup on the lower time frames knowing that you're in line with that high time frame trend. When you say higher time frames, is it in regards to uh is it all subjective? So like this could be the daily and then lower time frame could be the hour or it could be the weekly. 100%. So this framework is what I use to apply on my high time frame. High time frame can be whatever you want, monthly, daily, weekly. The key here is we want at least two time frames. Okay. The high time frame that you do your analysis on. The low time frame is where you're actually doing your execution. Do you have like uh any that you have set out? So like if you said weekly, do you have then the next time frame already? Yes. So what I generally do is if I'm using the weekly for the high time frame, my execution time frame is going to be the daily or sometimes even the H12 because I'm weird and I like the H12 time frame. But you got to pay for Trading View Premium for that one. If I'm using the daily or again the H12, my execution time frame then becomes the H1. Okay. If the H4 is my high time frame, my execution time frame becomes the M15. And then ultimately, I never really go down this low, but for the scalpers out there, you can go as low as the H1 and even down to the M5 as your execution time frame. So, this is the time frame where we're going to be applying the framework. This is the time frame where you're actually going to be looking for your setup. Where do you enter? Where does your stop go? So that previous drawing that you just had out, the higher highs, higher lows, this essentially would be this section. Exactly. And what we're going to go into in terms of like identifying and executing would be this section. I'm going to show you exactly where the best place to look for this is going to be. Amazing. So the next kind of concept that we need to cover is market structure. So market structure quite basic. Is the market going up or down? Are we making higher highs? Are we making higher lows? So this is going to be the easiest thing to see on your chart. I use just a three candle swing system. So that means if I have a candlestick here and then I have another candlestick in the middle and then another candlestick here. To me, this constitutes a swing high because there's three candles with the highest candle being in the middle and a lower one on each side. Some people use five candles. Some people do all sorts of crazy stuff. I like the three candle system. And this would of course be the inverse for uh a swing low. So, a market structure break means that we need to see a candle close through this high. That will constitute a market structure break. So, if we want to know if the market is in an uptrend, I want to see price putting in higher highs and higher lows. So, every time we get one of these new higher highs, this tells me that the uptrend is continuing. So, you can mark this on your chart as like an MSB. Here's another one. And what we're looking for now, of course, is okay, we've just had an MSB. My anticipation is even though price is pulling back, I'm expecting this trend to continue. That's the goal here. We want to find the point at which this pullback ends and the next leg of the uptrend continues because this is going to be where those high probability setups form. Hey guys, I hope you're enjoying this episode so far and don't forget we send every single strategy breakdown from every episode for free on chartanatics.com. So the link for that is in the description below. So just make sure you click that. You just put your email in and every single week we will send you an up-to-date PDF strategy breakdown for you to keep, to learn from, to reference for free. And don't forget, we're also launching Chart Fanatics Live where your favorite traders from Chart Fanatics will be live trading every single day. I will also be including special guests on the live Chart fanatics edition. So, make sure you go subscribe to that YouTube channel right now. It's linked on the main profile of Chart Fanatics. So, make sure you're ready for that. Let's take a break for a minute there, guys, cuz I want to tell you about our preferred prop firm here at Chart Fanatics, and it is Apex Trader Funding. We are no stranger to Apex. We've had Jadecap and Trader Kane on Words of Wisdom and here on Chart Fanatics. Now, they are well known for having record payouts on Apex of over $2 million a piece. Now, even if you don't achieve a seven figure payout, the reality of achieving a multi6figure payouts with Apex is absolutely achievable and an incredible opportunity at that. 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Now, you can get up to 90% off, 90% off the biggest discount in the entire industry at Apex using the code CF and the link in the description below. Thanks to them and thanks to Chart Fanatics. Make sure you get your futures funding with Apex. Now, let's get back to the episode. Next up, we're going to talk about the thing that actually creates these higher highs and higher lows. So, we're going to stick with our um uptrend example here. So, I call these POIs, points of interest. You're going to see a ton of different conjecture. If you're an ICT guy, if you're a smart money concept, who invented the terms, it doesn't really matter. They all kind of do the same thing. So, you might call them PDAs, you might call them supply and demand. I drank the ICT Kool-Aid quite early on. So, I use the ICT terminology. So, I use order blocks, OBS, I use breaker blocks, and then I use fair value gaps. Those are the three points of interest that I focus on. Um, order blocks are going to be the one that we're going to cover in this video in specific, but what you'll actually find is generally two or three of these will actually always show up kind of at the same time. There's an OB. Sometimes there's a fair value gap after it. There's a breaker. There might be a fair value gap there as well. Sometimes you have an OB and a breaker and a fair value gap. And that's the classic ICT. And then it's like, well, which one do you pick? We're actually going to help you with that in this strategy because sometimes people get a little lost in the minutia. You don't need to know as much about these as you actually think to get into the trade. And really the crux of what I'm going to share with you here is all of this stuff, we're going to put it together in a super easy way where by the end of this video, you're going to go on your chart, you'll be able to find it yourself. So those are the main three POIs that I work with. Think of the POI is where I want to do business. So when the market makes its pullback and we have, let's say, an order block form here, this is where you want to have your alert on. I'm now paying attention because in this area I'm now looking for that potential higher low to form. Exactly. So that's your order block. And then the expectation here because the trend leading into this was bullish is that a higher low is going to form here and we're going to continue that trend. So, this optimal area for the higher low is where I want to do business because the likelihood of me being right, me getting a trade that works out is way higher here than longing somewhere randomly in here or somewhere randomly on the way up. The next kind of concept that we want to cover here is going to be liquidity. Again, depending on who you follow and what vernacular you use, there's a lot of different kind of terms for liquidity. I'm going to be talking about three different things when it comes to liquidity. First is your external range liquidity. This is simply liquidity that occurs outside of the trading range. So if this is your price swing, okay, this is your trading range, let's say from here to here. Any liquidity that forms outside of this range is external. Any liquidity that forms within this range is internal. You can go way deep in the weeds on different types of liquidity. For simplicity sake, external range liquidity is going to be swing highs and swing lows that are outside of your current trading range. Internal range liquidity is just going to be a POI within the range. So an order block, this would be internal range liquidity. And a external range liquidity would be a swing high. Maybe it's over here on the chart that price could be drawing to. That's the basics of it. Again, what you're noticing here is ICT and other smart money guys sometimes like to really make some of these things seem complicated. They really don't have to be that complicated in practice. The last thing about liquidity we're going to talk about is the draw on liquidity. So, there's this idea that the market is drawn from liquidity to liquidity. That's what moves the market. Whether you believe it's an algorithm, it's the boogeyman, it's the CIA, the market makers, whoseever is moving it, they're moving it from liquidity to liquidity, draw on liquidity simply means that okay, if price ran below a swing low, where is it next likely to go? Okay, it's going to go over to some swing high and it just bounces between liquidity to liquidity. Draw on liquidity just simply means what's the next likely area. Yeah. So it's like essentially if this liquidity is taken the the draw on liquidity the most optimum is then the next one which would be in this case because the concept meaning that if the liquidity is taken here and there's nothing left it needs to then get obviously the draw needs to go to. So if I filled a bunch of longs here where do I want to sell off those longs? I want to sell them off way up there. And so that's drawn liquidity. What you're going to notice in the framework that I use here is we're going to be bouncing from external range to internal, back to external, back to internal. It's just going to be this kind of oscillation. Now, there going to be periods of time where it doesn't work exactly like this, of course. But this is really what's happening. Price moves from one area of liquidity to the next, back and forth. It pingpongs. And that is all you really need to know when it comes to liquidity. The last concept we're going to cover before we put it all together here is premium versus discount. So in a range we can bifurcate it into a half point the 50% here. So this is the top of the range. This is the bottom of the range. The idea of premium versus discount very simply is that discount exists at the bottom of the range. Premium exists at the top of the range. Now, if you want to really get into the ICT fanboys heads, you can draw a fib here and you can mark out your 61.8, your 78.6, your 70.5, the OT, the magic sweet spot that everyone talks about, but really what we're focused on here is discount is the lower part of the range. Premium is the upper part of the range. If you think about this logically, what do you want to do at a discount? Well, I want to buy. I want to buy when things are discounted. So that means longs probably higher probability in the lower part of the range. If I'm short, where do I want to short close those shorts? Well, I want to close them where the buying occurs at the discount, the lower part of the range. The inverse is of course true for the upper part of the range. If you want to sell something, I want to sell it at a premium. So I'm selling in the upper part of the range. Exactly. Short here, buy there. Yeah. I like to think of it as like I want to buy cheap. I want to sell when it's expensive. Okay, now we have all of the price action concepts. I just shaved saved you watching 12 months of ICT videos. Okay, just in this little basic bit here. So, now that you have a grasp on these concepts, I'm going to show you how to apply this. And what it's going to allow you to do is two super important things. It's one, it's going to help you determine your directional bias for your trades. You're gonna see a thousand YouTube videos with people talk about their daily bias. And it's one of the hardest things to figure out. It's easy to notice a chart pattern and say, "Okay, well, I've got a breaker here. I'm going to long it with my stop here and my entry here." But if the trend is down, right, this might not work. You're not going to get that result. So, how do I get the one where it actually works in my favor? That's daily or directional bias. Where is price most likely going to go to next? and then where's the highest probability area that this setup is going to occur and this framework is going to show you exactly that. So I'm now going to put together everything we had just discussed. So let's again assume we are in an uptrend. So price is going to have a high here and then that high is going to get broken. So now we can draw a red line across there and that's your market structure break and then this high starts to form and we now have our trading range. So you have the swing low and you take that all the way up to the swing high that formed after the market structure break. What we're now looking for is the point of interest that led price to create that higher high. So I generally use order blocks or breakers for this. Those are the most common ones that I use. But that's going to generally form somewhere down here. And we'll just draw that as like a box. So this is your order block. In terms of your order block, how are you identifying an order block? So for me, it's very simply the down move before a move that went up and broke market structures. So if we had, this will be tricky to do here. So, we're saying we're on the way down. We've already been down, you know, a few times. Um, and then you have your bullish candle. Are you saying that your order block essentially would be like that? If this is obviously, assuming this continues to make a new swing high, yeah, you can also combine these. Okay, so there's a little bit of nuance here. Some people like to combine candles. Some people like to use a single candle. The way I like to think of it is think of it as the selling that occurred before the buying that took out, you know, this high. So, if that's three down candles, you can use all three. If you just want to use the very last down candle, you can do that as well. What you're going to realize is you don't actually have to be as precise as you think because remember this is the high time frame. We're actually going to zoom in. Yes. To look for the low time frame. You want a bigger space. Yeah. I the way I like to describe it is what we're looking for here is you think of it as like a scope with your sniper. Mhm. This is where we're zooming in now and this is where I want to focus on. I don't need to worry about anything that's going on here, anything that's going on here. You don't need to have like a really precise area because you're really going to go snipe within that area. People get so lost in the weeds like is this the exact candle that's the order block? And I'm like well actually it's kind of like both of these. What you said makes sense though in terms of if this is let's say it's taken two candles to go down and it gets broken in one. You then take that area because the definition well the concept of an order block is essentially a block of orders. Exactly. Exactly. So we'll delete just this stuff here and we can delete the little sniper. I like the sniper. Let's take a break for a minute there guys cuz I want to tell you about the best CFD prop firm in the entire industry. Funded Next. Funded Next is a proud sponsor of Chart Fanatics and they have been leading the CFD prop firm industry for many years. Literally a top three prop firm. Now, why is that? Let me quickly just run through all the incredible things that they do. First off, they have challenges for every trader. Whatever you're looking for, they have. They have a one-step challenge. They have two-step challenges. And now, industryleading instant funding. 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And something that they did first, if you don't receive your payout within 24 hours, you will receive an additional $1,000 compensation. Now, if that doesn't tell you that they're for traders, I don't know what will. Now, make sure you use the code CF to get the best offer available at Funded Next right now. The link is in the description below. Make sure you join Funded Next today. Now, let's get back to the episode. We now have our trading range. So, price is now pulled back. We have our 50% line here, which means a few things. We're now in a discount here. So, what has happened so far here? Seems like we've talked about a lot, but really this is quite a simple graph. This order block is the down move that caused that market structure break. Well, really what happened here is this is external range liquidity that got taken out. Price is now trading higher and we now have a trading range. What becomes the next draw on liquidity? It's that point of interest back within the trading range. So yeah, we want to look to long here, but if we're up here and maybe we get some sort of SFP here, our drawn liquidity until we get down to here is for shorts. So even though the high time frame might be bullish, you could theoretically look for low time frame shorts knowing that price is trying to draw back and mitigate this order block and tag that internal range liquidity. And then of course we're looking for price to create a higher low here within that POI and it just tagged internal range liquidity. What becomes the next target? That old swing high. And then this process repeats over and over and over again. So I know it seems like trying to remember order blocks, external range liquidity, and all that stuff is complicated, but if you can just kind of get an idea of this framework, all you need is one price leg. You need price to create a new high, and then you need to mark out the range and then you need to find the order block. If you can do those things, all the trades that you take here are going to be so much higher probability. Whenever you've had examples where you're like, "Okay, I'm trading and it made a pullback here. I longed it and then it did this and why did I get stopped out before the actual move happened?" This is going to help you avoid that because in here there's going to be little bounces. There's going to be little pullbacks. You might think it's reversing and it might, but the highest probability trade is going to occur back at this internal liquidity level, back at this point of interest. And if you just focus on this, you simplify all that other noise you're looking at and you say, "Okay, this is my weekly chart or this is my daily chart." Great. Now, if this is the daily, we're going down here on the H1 and we're now actually going to go look for our entry. Okay. So, now go ahead and wipe all of that. Just to emphasize, we are now going to focus here. Yes, we're focusing on here. So now imagine we've taken that scope. At first we were looking at the entire field. Now we've zoomed in and we see the guy's head, right? We're ready to get the the head shot in Counterstrike or Call of Duty. So now we have this order block that we're within, right? This is our high time frame OB. So let's call this just the the daily order block. Yep. Just so we know. And price is on the on the daily. This might even be one or two candles. And you're like, well, how do I get an entry? Well, in fact, you can actually just enter on the daily. You could literally enter right at the top of the order block and you can put your stop at the bottom and then you can target that external range liquidity at the high. You can do that. However, if you want to get a more precise entry, which we always do, and get better riskreward and get a tighter setup, because sometimes these order blocks are rather large and the stop has to be super wide. Zooming in to now the H1 chart, which is what we're on here. This is where we're going to look for that actual setup to form. This is where your kind of dealer's choice occurs. However you like to enter a trade now that you're in line with the high time frame bias because we have our daily chart is bullish. We're in the daily order block. We're expecting daily continuation. Long setups that occur in here are higher probability. They're not all going to work. If it was that easy, we'd be doing this on a yacht. But the probability is a lot higher than trying to find, oh well, this is an H1 SFP just randomly in the middle of nowhere and that, oh, why didn't that work out? But then the H1 SFP that played out here ended up being huge. This is the key, and this is, I think, the thing that most people miss early on in their trading is they're looking for their entry pattern to form without the high time frame picture. So that initial setup there that gives you the high time frame picture. You have your directional bias. You know exactly where you're looking for the low time frame setup to form and you know once the setup forms in here, you're targeting a high time frame higher high. That's all the ingredients and you're at a discount. All of the checklist that you might have, all of those things are pinging. So there's a variety of different setups that you can take on a low time frame. You can find a fractal of the high time frame setup within here, right? You can see a low, right? And then a high get made and then a pullback into an H1 order block. Like you can see that form within here. Maybe you use this might sound blasphemy on this podcast and coming from me, but maybe you use indicators. Oh wow. And you might see you might see price do something like this into this zone and then the RSI is putting in a bullish divergence. Right? There's tons of different things. The one that I'm going to share with you is my most common setup and it's a breaker. The reason I really like the breaker entry is because it gives you the entry and it gives you the stop-loss. So, what we're going to be looking to form within this daily order block is first a swing low on the hourly. And we're not going to enter on the first swing low and move away that we see and assume that that's the bottom. I'm actually looking for liquidity to be engineered effectively here and people to say, "Okay, well, we're bouncing. I'm gonna long." And what do they do? They put their stop right there. Yeah. I want to now see that swing low get taken out. And then I want to see the high that generated that swing low get broken. Get broken. Would you say in terms of this uh would it just be a bounce? Is it just a bounce enough or do you want it to see uh it break let's say a false break essentially? So there's a few different ways to look at it. Some people use a change of state of delivery. So it's as soon as it as soon as it uh trades through the down move. The more confirmation in my opinion the better. Using the full break of structure is going to give you worse riskreward than using like an inverted fair value gap. I don't want to get like too crazy with the reaper death seal fair value gap, but in theory technically once that liquidity gets run like you're going to see like some sort of low time frame FVG like do this and it's like oh I could have entered right there. Yeah. But by waiting for at least in my experience and the data that I've collected by waiting for that high it's increasing the probability to get broken you're getting way more confirmation. But in terms of this one though, the engineered liquidity. Yeah. Do you do you is that a bounce is enough or do you want that to break as well like a high which is essentially then saying okay now you know I mean it's kind of bringing in early buyers. That's what I would class. Yeah. So this I call it double confirmation actually. So if you get just this is your single confirmation. If you actually get two shifts because then effectively you've got a double market structure break and the run. More confirmation the better. And this is to me this is like the most the strategy so far is very mechanical. Yeah. This part is the most subjective. Yeah. Because everyone has their intricacies of how they like to enter. The reason I like the breaker is because once you get at least this right like at least the swing lows form there and then you get that run of it and then the structure break you now have your breaker block that forms right that's your entry. And how would you define the breaker just for the So the breaker is going to be an order block that breaks, right? That's like the that's the entire title essentially the same thing that we marked out, but in this case rather than looking to short from it, you're expecting it to break because we're in this higher time frame area. Yeah. So like look at like imagine price is pulling back here and this would be a bullish order block right here, right? Yeah. But then it doesn't work as a bullish order block. ends up losing a low and then reclaiming it. It's like a SR. Like people will call it the funniest things, right? Like it's kind of like, you know, you have an overunder under over, right? People call them over unders. Some people call it a reclaim. Like there's a bazillion different ways to like inverted head and shoulders. Yeah, inverted head and shoulders. They're all It's all the same thing. But yes, the breakers, right? It's a bullish breaker is going to be a failed bearish order block, right? Yeah. And now we're getting real into the ICT nerds here. But the reason I like it so much as a setup is because you have an entry and then to me the risk is the stop run. Yeah, you could put your risk right below the breaker, but at least because I'm a crypto trader, I find that those get tagged more. You get a lot of wicks in crypto because it's less liquid. So I find having my stop here, like if if this low gets taken out, I'm wrong anyways. And now you've got this setup within your high time frame bias. Are you holding this trade to the external? Ideally, you should, right? Because your draw is way higher. But very much, but very often, right, if you can get a pretty decent riskreward in here. I'm I'm 2R. I drisk. So, I either take half off or I'll move my stop to break even. Depends what I'm like doing, how confident I am on the setup. It also changes if I'm layering like if I'm entering on the M15. Mhm. And then I used the H4, but then let's and these are both bullish, but let's say the the weekly is bearish. That's slightly less high probability than if all three were bullish. You know what I mean? Yeah. But in theory, the idea here is you're finding the exact moment that the high time frame higher low is forming. Yeah. That's what we're really looking for. I'm looking for the exact moment that the pullback on the on the daily ends because on the daily this might just be two candles, right? I'm trying to find this exact moment that this uptrend is resuming and this is kind of the clue. Okay, we're no longer going down. We've been trending down into this level. Okay, now we've got a change in character, a break of structure. There's so many terms. um and it's um the optimal area to get into that higher low and then absolutely you can ride this thing to the high time frame, higher high. So just one thing that stands out to me potentially I love everything so far, the layers, the simplicity as you mentioned very early on because we're looking at two time frames. Uh we're looking at very clear uh you know pointers, the the range, the liquidity aspect, uh the structure and then your your OB in this case. Uh and then you have your area as we said we zoom in for just this bit though what's the reality would you say obviously each case will be different but are is it a reality where you might take a loss or two in this area because it's giving false signals breakouts wherever it may be absolutely I mean the the beauty of trading right is asymmetric riskreward like that's the number one all of I should preface with all of my entries I need is part of my checklist the riskreward has to be a minimum of 2 to one. Yeah. So, if I see this form, but like the stop is, you know, really wide and I'm saying, "Okay, well, the target it's only going to be a one to one." That's no longer a trade, even though it ticks all the other boxes. I need a minimum of two to one R. Got you. And this is because you only need to then win 33% of the time, right? So if you can win one out of three trades, you're breaking even if each trade is two to one. Like that make that was a quantum leap in my trading was like you always see 100% win rate. I have a 90% win rate with your strategy. I'm like dude I can't win 90% of my trades. I'm lucky if I get half. Like dude, if you can win half, you're going to be rich. You're going to be rich. Like there's the the math on on riskreward. When you do it this way, it makes it seem so much more attainable. Yeah. Because if you can be right 40% of the time, but it's 2 to1 RR, you are profitable. So I I you absolutely are going to have false positives. You're going to have one that it takes out the low, you enter, and it takes out the low again. Yeah. But I'm willing to take multiple shots here because my strategy allows for it and because I'm of the belief that I'm in the most optimal area for the reversal to happen. Plus, it's not a case where just because it took you out, you then enter straight away. you needed to break again. Yeah, exactly. And still hit the markers that you And these are great lessons, too, right? Like you get stopped out and you go, "Okay, well, what went wrong there? Did I enter too early?" Maybe the breaker form, the setup formed like right as it touched the OB and you should have given it some time to to work the level. You got to remember this daily level might be a time. So, crypto is not as in line with the New York Open, the London session, things like that. I have found over the recent years and this is probably in part due to institutions now getting in the pool that it is starting to trade more like New York open we always have a move in crypto now we have you it's it's it's actually shocking like you get the pre-new york pump and then it fully reverses on New York open like that's been happening consistently for months now and um that used to not be the case that being said because I trade on the higher time frames so I'm trading weekly and the daily a and then the daily and like the H1. Yes, there are times where it's like all lined up, but I find the timing of the setup that's more important for like low time frame intraday traders. Yeah, true. Crypto it's it's nice cuz you know you might get a trade on Sunday. You know, when you're trying to watch the football game and not pay attention to the charts, all your alerts go off. It's true. It never ends. No switching off. Okay, cool. Let's go through, as you say, the pros and cons. If you want, I can do the cons on this side for you. Let's take a break for a minute there, guys, because I want to tell you about our incredible sponsor, Tradezeller. Tradezella is the number one trading tool in the entire trading industry. Tradezella allows you to become a more profitable trader. Allows you to make immense progress as a trader, no matter if you're a beginner or an advanced level trader because it makes journaling easy. It makes journaling something that is fun and enjoyable and something that is interactive. So, no matter if you're a crypto trader, no matter if you're a futures trader, no matter if you're a forex trader, no matter if you're a stock trader, all you have to do is select your broker, your platform of choice, and connect it to Tradzella, and it will automatically sync your trades and pull all of that data onto the dashboard, making journaling and finding your edge and adapting your edge so easy. In collaboration with Tradzella and Chart Fanatic specifically, we are actually getting the playbooks from the episodes that we're filming with these incredible verified traders and adding them as playbooks onto Tradezella. So, you can actually go on there and see the rule sets already predefined. So, make sure you check that out as well. Now, you can actually get 10% off your monthly subscription using CF10 on Tradella right now. But more importantly, I would say CF20 for 20% off your yearly subscription with Tradezella. The links for Tradzella are in the description below. So, make sure you go check them out. Use CF20. Get 20% off your yearly subscription. Become a better trader today. Now, let's get back to the episode. So, the pros almost spelled wrong. Go to school, kids. So, the pros is it's simple, right? Easy. That was one of the biggest things that not just drew me to this system that I've slowly put together, but to price action. I found indicators complicated, man. It's like Ichimoku clouds, all these different moving averages, divergences, and stuff. I'm like, "Okay, this is like complicated for me." So, it's easy to understand and it's clean. If you're OCD, your chart's always going to look nice and pretty and you can post on Twitter and get lots of likes because that's almost as important as making money. Of course. Um, second is it combines a lot of price action concepts that again people seem to over complicate. Like you can find 500 videos about order blocks, daily bias, market structure, trends, and it's analysis by paralysis. You're like, "Okay, do I whose videos do I watch? Who's doing it right? ICT said this. This guy's saying this. This guy says ICT stole from this guy." It's crazy. With this system, it combines all of those things together. So, OBS, ranges, bias, all of it is combined just in the framework of one price swing. You now know the direction where you want to look for your trade and where you think it's going to happen and where you think it's going to go after. It's super mechanical. I think everyone early on, they want something that is mechanical because someone's like, "Oh, here's where you look for your setup." I was like, well, what's that mean? You know what I mean? Like, this is like almost so mechanical that you could code it into a 100% into an algo. Now, when we get into the cons, we'll expound on this a little bit. And then to your point at the very start of the video, any asset, any time frame. So, this is not cryptosp specific. I've used this in um I've used this in FX. I've used this in futures. I've used this trading commodities. I've used this trading crypto. It just works as long as you're doing top down. Yeah. As long following the system, you need a minimum of two time frames. Your high time frame is the one that you're drawing your range on, and your low time frame is the one where we're looking for that setup on. Now, the cons, just because it's simple, it doesn't mean you don't have to work. You still have to get into the charts because it's very easy for me to draw it for you on a whiteboard, show you a hindsight example and say, "Look, it happened perfectly." Everything is different when you're doing it live. The nuance, it's game time, right? Shooting a penalty kick in practice is way different than doing it when you know the lights are on you. You have to require work. It requires work. You've got to be able to recognize the pattern live. Um, and just because it's mechanical, I think some people think it's all you need. Mhm. No system is purely mechanical. Mhm. There's always some discretion. There's always some subjectivity. There's always like there might be a setup that that has all of the things. I just don't take it. Yep. For whatever reason. Maybe I had a tummy ache. You know what I mean? Or maybe something else is going on. SPX is nuking. Bitcoin's printing along. I don't like it as much. Yeah. So early on, I think a mechanical strategy is great, but if you want to become profitable, you need to make this your own. I like to think of this is a Trojan horse for price action. I'm showing you like some very like basic stuff and I'm kind of force feeding you a bunch of like price action stuff that you maybe don't want to learn and all of a sudden you are marking out order blocks. You understand daily bias now without really going through the ICT mentorship to figure out what each one of those things mean. So I feel like the mechanical aspect really well the whole thing is but then when it comes to the execution over time and to do it successfully and profitably long term that's where you have to build that discretion that intuition that that deeper understanding and you might trade gold all the time and you might say you know what the way that Maine showed me to mark ranges it actually works a little better this way on gold right so and that that's kind of the last con last con like it's not always going to work like That's trading. Levels will get blown through. Ranges will fail. POIs will get smoked. In a super hard trending market, you might not get that really deep discount pullback where you want to look for the setup. This is a super true for crypto when it's trending hard. You can't you can't be looking at the daily and the weekly. You got to be on the H4 to find pullbacks because on the daily it's just a green candle, right? So it it it it's not always going to work in every trading environment. So you have to know your Yeah, exactly. your environment and the conditions you're in. You got to know your market and you got to be malleable, right? That's one of the things I think people there's something about being robotic in trading, but you still have to have the ability to be malleable based on the asset, the timing, all of that other stuff. So some tips that I find make this a even better system. Practice obviously. So, the better you become at pattern recognition, um, the you're you're going to see this everywhere. Every chart you're going to look at, you're going to say, "Okay, there's my range. There's my order block. There might be a put in the chart time, right? 10,000 hours, whatever you want to call it." If you're not putting in the chart time, back testing, forward testing, it's not going to work for you. You got to be able to see it form live. Um, I think adding additional confluences. Would you say you have to be careful with that as well with the additional confluences? Yes, because you don't want to overdo it, right? Especially early on like when I tell people who are learning to trade like Bitcoin with me, I say just look at Bitcoin in a vacuum. It's not in a vacuum. Like if S&P is nuking, good chance Bitcoin is going to nuke. Even if it slightly is going up like and they're diverging for a period of time, really they're probably going to end up going down together. So initially start with it in a vacuum but as you get more comfortable yes find more confluences do cross market analysis don't just look at your USD what's the DXY doing? Yeah what are these cross pairs doing and adding those additional confluences will increase the hit rate and adding even another time frame. So instead of just using the daily and the H1 and you say okay well the daily is bullish so I'm gonna look for bullish setups on the H1. Well, if the weekly is also bullish, that's now an even stronger hit rate. So now, if you're in the bottom of a daily range and the bottom of a weekly range and then looking for an H1 setup, that's going to be a way higher probability trade than one that's only based on two time frames. Do you use by any chance off topic in a sense, but like do you use dynamic sizing or Yes. Is this where you would look to Absolutely. if I have multiple confluences like if so I took a trade on euro the other day dollar's taking out a weekly low into a monthly fair value gap that hourly setup to me it's like this is where you get that home run trade that's going to give you like you know five six sevenr uh so yes I absolutely use dynamic sizing also dynamic sizing is super important in crypto because when the market is regular v versus crazy v like we had a period a couple weeks ago where over a 10day period, Bitcoin went up and down 10% almost every day. Yeah. So, if you're opening a million dollar position, like normally, and now it's that volatile, all of a sudden you're offside 50K like three hours into the session and you're like, "What the hell happened?" So, yes, dynamic sizing. If you have more confidence in a setup, maybe this is where you risk two or 3% instead of just one. Let's start up the charts. Let's see some examples, shall we? All right. So, now we're going to go over some chart examples here. So, this is going to be painful for some uh Bitcoiners out there because this literally just happened. Um, but as you can see here, we have our range. So, in this case, it's a bearish range, right? We had a low and a high here, and we broke market structure to the downside, creating a bearish price leg. Yeah. First thing we do is we mark out our range. So there's the swing high down to the swing low. Next, you mark out our PD array. So in this case, it's a bearish order block. Again, this is the up candle for the move down that broke that structure there. Took out that external range liquidity. And now we're simply waiting for price to pull back into that area. And that becomes the short that you want to take. And I actually took this short. You can also see here I pulled the fib. It shows that we were at discount pricing here. So, we were in the upper part of that trading range. Again, we want to short in a discount. Yeah. So, this is our high time frame. This is the two-day chart. So, then zooming in, you can see here I took a little bit of a breaker setup here. We took out a swing high. So, this is that two-day order block here. Took out a swing high. We broke structure to the downside. We came and we retest. And this is exactly the kind of stuff you want to see to know you're on the right side of the trade. I want to see like ICT always says like, okay, I want to know that the institutions are in this move. It's institutionally sponsored. Really, what does that mean? It means that you're getting a big effing move in the direction of your trade. You don't want it to just kind of do this. That doesn't give me confidence. I want to see a big fair value gap form. I want to see price move down aggressively to let me know that yes indeed my little 30 minute setup here is working this well because it's in line with that 2D order block that 2D order flow all based on that basic framework. So I have another example here of that exact trade that I actually took uh in Discord. So, we have our market structure break. We have our bearish order block. And in this instance, I just took the trade off the high time frame. So, I didn't even let me just make it a little more zoomed here. I didn't even wait for price to go in on the low time frame. I simply just took the trade because you can you don't have to go in and dial in your your setup if you think that the riskreward is good enough as is. Let's take a break for a minute though, guys, cuz I want to tell you about our incredible partnership with propfirmtrader.com. Majority of you out there are prop firm traders. You're using prop firms to leverage your trading skills to be able to get more capital and to be able to absolutely change your life. So what's important to be able to find the right challenge for you with the best firms and most of all the best prices and that is exactly what propertrader.com does. propformtrader.com's allows you to compare prop firms be able to find the best challenge suited to your trading style and get you the exclusive best discounts in the entire industry so that you're paying the cheapest price possible for your prop firm challenge. So on propfirmtrader.com, you'll be able to use filters to be able to do that and find the exact challenge for you. Be able to find your favorite prop firms. Just look on screen right now. You can see futures firms. 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Again, all you do is for any of the firms on propertrader.com, use the code PFT at checkout and you will automatically be entered every single week. The link for propertrader.com is in the description below. Now, let's get back to the episode. We have our range, we have our bearish order block, we have our point of interest, and I literally just entered there and I put my stop above the swing high there at the order block. And the result was everyone cried and we all lost a bunch of money. But you made money at the same time. I made money. A lot of people lost money. I actually even posted this one on Twitter because I'm so generous saying this is the exact spot where we would have a lower high. Yeah, the bears have a super clear invalidation. This is the point of breakdown. So if we're in fact seeing a trend shift, this is the most optimal place for that to happen. And that's all we're really looking to do. Just talking targeting the new external targeting the new low. And so you can see the candle looked really nice. Everyone got bullish again and that same candle closed horrifically. Mhm. And uh there's your full TP. So I closed that trade. The next example I have here is a soul trade that I took to all-time highs. Same idea here, right? You have your Oops. Oh my god. You have your swing low. Mhm. You have your swing high. I'm sorry. My lines are not very straight. And then you have your order block. So again, what are we looking for here? The last candle before the There's your market structure break. So there's your external range taken. This is the POI that generated that fresh high. So if this thing is going to continue to go in its uptrend, this is the most optimal area for that to occur. If I drew my range out from here, this would be the discount of the range. And would you be doing your range from from this this the absolute low or from the low that led to the break? So the easiest way that I tell people to do it initially is you want to take the swing low Mhm. to the swing high. Just the most immediate one. Okay. Now once you get a little bit more nuanced with it, the trading range that you define can can change. You could use you could say, well actually this is really the most meaningful swing low of this price leg because on the monthly chart this actually is the swing low and this is the swing high on the monthly. But for simplicity sake of the system, I tell people to just take the most immediate low. What is the exact swing low before the most swing high? The downside of doing this is occasionally it might come down and hit this order block, right? Which is still within this range. Yes. And then that ends up being the higher low. But for beginners and for to be honest with you, doing it this way, it works plenty fine. And more often than not, I think it's a problem where everyone's trying to be perfect all the time. Yeah. Well, there's again, it's that kind of discretion aspect. What's the swing low that matters? Like you can't go on YouTube, you'll find 10 different people tell you a different way to pick your working range. Yeah. Right. This is the easiest way to explain it. So again, this one you could have just entered as soon as it retested, stop below target the external. Yeah. In this instance, I actually zoomed in. So you can see price I zoomed in here and I actually took a low time frame entry off of the sweep here, but this is the exact same trade again. We came back to the order block. We built up some liquidity here. We actually ended up building up one more low and then it ripped and that's what you can see in the next picture here. And this went all the way back to all-time high. Again, how do we know we're in line with the high time frame move? Fair value gap was formed. massive fair value gap formed. That's true. In regards to this though, because obviously you can trade this with crypto, but another benefit can be that you can use this to short-term well, it's still trading, right? Where you you buy spot and then sell when the price has gone higher. Absolutely. And we've talked about this before, like at the end of the day, if you want to buy Salana spot, you could have bought it here and you would have made money when it traded to 300, but this was the best time to buy it. And you still need to know where that idea is wrong. Maybe you buy that spot here and we we do this and you want to cut it. Maybe you need to cut that and not round trip it back down to $10 or wherever it might go, right? Yeah. And that's the problem I think a lot of crypto people have with spot is they don't think of it as a trade. It's still a trade, just it's a trade on a higher time frame if anything. Um, next up, I also long Bitcoin to all-time high using the exact same strategy. And people are like, "Oh my god, he caught the long before 100K." It's like with the most basic price action of all time. You have your trading range, a low to a high. You have your order block. You have price pull back into that order block. And on in this instance, we actually got a high time frame sweep, which is like that's like money in the bank in my opinion. Like if you were to enter this here and your stop was here. Yeah. And then we got this sweep, I would add more size and I would bring my validation up to there. Okay. But in this instance, I actually ended up zooming in if I'm not mistaken and I entered in on a low time frame setup. So you can see here we came into the order block and it was just like I was showing you guys before. I'm saying, okay, let's see if they generate some liquidity. Yeah, they're creating some lows. We took one of those lows out and now I'm just waiting for that shift. Right. So I ended up entering quite aggressively because this is that H12 SFP I was talking about. Yeah. But then here's your H1 breaker. There's your H1 market structure break. There's your invalidation. So that entire fractal, that's exactly what you see form right here. You see it? Yeah. And it's within the high time frame zone. It creates a fair value gap almost immediately. That tells me that I'm very much on the got to get the the clout from the boys. Uh but again the fact that you get these thin long moves that tells you that this is like an inst I hate saying like institutionally sponsored momentum. I'm on the right side of the trade, right? Like anytime you get that move where it's like okay it tags your entry and then it gets going. Fair value gaps are the easiest way to identify that. Like are we seeing expansive moves to the upside? Yeah. Then I'm on the right trade. And I think that was it. So I love that. That's literally longing the pico low of Bitcoin and then from here it traded to $110,000 and we entered it using two lines and an order block. So all those ICT guys out there who are telling you all these different concepts and stuff, lots of it works, but simplicity also works at least to begin with. Yeah. And then you can Okay, now I want the unicorn setup. I want the breaker plus a fair value gap and I want an SMT divergence between Bitcoin and ETH at the lows. Bitcoin made a lower low, ETH made a higher low or something. You can add all of that to this system. But the main thing you said there is if you want if you want to, but it works as is. And if you're saying, "Hey, I'm hitting 40%. I want to get to 45 or I want to start hitting, you know, three or four." That's refining your edge. You're sharpening the knife. But this is, like I said, it's a Trojan horse. Here's a bunch of stuff to get your feet wet. You can actually take this, start marking up your charts, and then go ahead, go crazy with it. Add all sorts of different make a PDF that you'll sell for $15 to someone with your entry technique, which is just this. I'm sorry for any gurus that I've now ruined your thing because this is how a lot of guys I know, teach people to trade. They're like, it's the sweep and then the structure break. It's like, well, it's just a breaker, but whatever you want to call it, unicorn thing, go for it. But this is it, guys. It works. Proof's in the pudding. Thank you, man. I really appreciate it, honestly. And I know everyone at home does as well. Drop a comment of your biggest takeaway. Any questions you have for Maine, drop them in the comment below. Maybe he'll see them, maybe he won't. We'll see. But what you should definitely check out are the links for Maine and Breakout in the description below. Drop a like, hit subscribe. Other episodes are on screen. And until next time, it's been Char Fanatics. Take a