Strategies for Market Maker Models

Okay folks, welcome back. This is model number six, supplementary lesson. And the model number six obviously is dealing specifically with market maker buy and sell models. And we talk a lot about scalping and day trading and one shot one kill and swing trading, but I want to kind of like touch on a little bit of position trading. I know some of you have that affinity for that longer term analysis style. So. Right away, you should see this as a market maker buy model. And the reason why it took me so long getting to this lesson, and I apologize, waiting to the very last day where it can be delivered. So we are on the 31st of July, 2019. And what I was looking for was the lesson in which between April and June, something in there, one of those videos, I mentioned this actual setup here. And I just can't recall exactly which video it was. I want to talk about how from a long-term perspective, and I'm just going to add some notes on this as we go. I'll just jawbone a little bit as I'm doing it. The gold market. I mentioned at the time of the recording, and again, I don't have the recording on the top of my head right now, but it's in the mentorship library. Because the commentary I gave was along the lines like this. I was talking about how we did have a smart money reversal, low risk buy, reaccumulation, and the market should accumulate in here, okay, because of this area of distribution. And I mentioned specifically with... reference to the dollar index that it could go higher for gold, in other words, versus the dollar and the dollar would remain in the range. So that's how I know that the weekly commentary videos has the dimension of it. I just don't recall exactly which one it is, so I'll counsel you to help me find that. I'd appreciate it because I'd like to be able to add an annotation to this post for other members. But the understanding of the market maker buy model is necessary before we have any understanding of higher time frame long-term position trades. But everything that we talk about in reference to IPTA and market maker models bought by yourself, they're all fractal. That means the things that we look for on one time frame will be the same thing in other time frames. So we're not really demanding a whole lot of new insight, just understanding the same insights just apply to a longer, higher time frame. Ciao. What I have here is the model itself, the buy model, has been outlined. So everything to the left of the curve, okay, this is the curve. Everything to the left of it is the sell side of the curve. Everything to the right of the smart money reversal is the buy side of the curve. All we need to do is look at the points of reference where there's up-close candles on the left-hand side. For folks that are not in the mentorship, that are not formally trained by me, when they see these things, they quickly right away run away with thinking, oh, this is Wyckoff. The application of taking the very points here and bringing them over here, taking this point here and bringing them over here and adding institutional order flow. That is not Wyckoff. And anyone that's ever studied Wyckoff, and I challenge, if you haven't ever done it, just study it in passing, and you'll see that what we're teaching here is completely beyond the scope of Wyckoff. So what I want you to look at is how everything on this side of the curve, on this weekly chart for gold, is. directly lined up with the previous area of distribution. So there's no ambiguity, there's no guessing, there's no what supply and demand zones do I look at because it's not supply and demand zones that we're working with. We're looking at specific criteria relative to a model of accumulation and distribution. It goes without saying that the point of equal highs up here is our buy side liquidity. And this would be the area at which we would look for price to want to rebalance. Okay. In these areas here, we're going to go down to a lower timeframe. Again, this is a weekly chart. The market will want to seek the buy side liquidity above this high. And you can see we've recently done that. So from the area of accumulation to an area of offset distribution, okay, so we're pairing up buyers. Okay, we're going to buy down here. Why are we buying? We're rebalancing and we're also mitigating previous shorts. So IPTA is allowing that distribution here to be accumulated and rebalanced. And then after rebalancing, look how much time they spent inside that range. That's accumulation. Okay, so it feels alien to say it, and I hate sounding like this, but I know it's in the mentorship. But I said that we would be bullish on gold here and look for this to be ran out and still see the dollar index remain in a large range, which is essentially really what it did. But in this area, we can see accumulation, and in this area, we can see accumulation here. Okay, so. What I'm going to do is I'm going to add one more rectangle in here to kind of like differentiate the areas on the lower time frame that we should be paying attention to. Okay, and now. But right away you can see there's very handsome amount of points or pips you want to refer to to get from this point here and then reaccumulate some more and then run the buy side liquidity out. So you're buying here looking to sell to willing participants that are willing to buy up here. So we're buying a smart money area and we're selling to an area where there would be buy stops. Which buy side liquidity would be up there? Large. funds. Because remember they're selling short on gold and this run here, look how much time it takes. Now again, it's a weekly chart. Every one of these candles represent one week. It takes a great deal of time to get in here and once they accumulate, do they waste time? No, man. It's a large range that starts kicking off and this is a weekly chart. So let's drop down into a daily and get a taste of what transpired on that time frame. Right in here we have our normal delivery of price inside this area of accumulation. We have a rally higher after seeing support, support here, and we're also looking at the October contract. Okay, so I'll ask you to go and look at the August contract for gold. We have a rally higher, one big candle, and then we have a complete return back to the bullish order block. And we have a little bit of a fair value gap in there as well. And price accumulates and releases to the upside. Buy side liquidity pull. Spend some time in here. Comes right back down into, here's our high. Here's our low of the next candle, the red candle. And here is our fair value gap. All it needs to do is trade down to the low of this candle. The low of that candle is 130.30.6. The low on this candle here. comes down to 130.296, goes one point into the fair value gap. That is our institutional order flow entry drill entry technique. I go there. Inside and at a deeper discount than what we would be expected to see on the previous sell side of the curve, remember we extended that over here from the weekly, anything in here can be used to accumulate a new long position. market again creates a bullish order block here market expands on the upside trades back down into the bullish order block inside that area Okay, we can accumulate new long positions here or add to what we already accumulated down here and the market Expands and trades above the original consolidation where the large pool of asset liquidity rests So I want you to think about how in this area May, the dollar market, okay, or the dollar, U.S. dollar, became relatively bearish inside of its large trading reach. Okay, and it traded down into June 23rd, I think it was. Let's see. What is that? June 25th creates the low. And then we start to trade back to the middle of the range. it starts rallying after we get this breakout here but this low on the 25th of june the 25th of june is where we are here 25th of june is there okay so the low inside the range of the dollar index on its daily chart was here and gold maintained this area around that old equal highs on the daily chart and weekly chart. So the buy side liquidity pool is being consumed. So gold is staying up here allowing the dollar index to come back and rally. Now we have since taken out the buy side liquidity pool here, closed in our weekly SIBI. So if this were to start trading higher than the weekly CIVI trading into its weekly volume imbalance for the dollar index and again I'll counsel you to do that research yourself look on the weekly chart. Contrast that with how we have traded to this area here on gold if the dollar index at this moment starts to rally higher than 98.40 this will be bearish for gold and gold will want to come back down in here and we'll see what it wants to do if it comes back to this area or not. My concern is they have both moved to a point of buy side liquidity and generally these two markets are inversed or inverted in terms of correlation. Very difficult to decide which one I would want to see happen but if I were looking at the chart I don't feel that we're done on the upside per dollar. So that to me would indicate that this buy-sell liquidity pool is being used to accumulate short positions. And then they may take these lows out if we get a really long-term prolonged bull move on the dollar. And that's just the conjecture at this moment. I don't know for certain. I'm just really leaning heavily on the fact that I told you in the mentorship that we would be bullish gold down here and wanting to trade up to this level here. So I think. Zoom out here on the daily chart, you can see we don't have a whole lot of price action because it's spotty. The liquidity wasn't there until really about in this area, March and May. The reason why I'm talking about October is generally October becomes much more liquid. In other words, the largest open interest goes to October, and we don't really see too much of the August contract. August contract is Q. You can see a little bit thicker in terms of the candles. All right, moving back to the October contract. You can see that while October is later in the year, generally you want to be trading nearby contracts, and October is not the nearby contract when we're in like May and June. August is but I generally will roll to October if I'm going to trade gold because and you'll see that October generally has all the open interest You want to compare all this contract nonetheless But you want to be in the October contract if you're going to do any trading or paper trading it so this is what we have for the gold market and to me, I think it's A testimony to what we have already shown multiple times with the market maker buy model, with price action, how price is delivered. And it's also a convincing factor for me when I was coming up and understanding how price is delivered. All of these factors are leaning on the same principles of market making. Price is offered. to an imbalance, then the imbalance is rebalanced. So it goes from contraction to expansion to contraction to expansion. From premium to discount to discount to premium. Everything is logical. There's nothing that's ambiguous when you can see it in price. Now, granted, there's going to be periods of time when you just don't see it. And that's fine. There are periods where you don't do anything at all. And you don't force it. But when you have things in alignment and you understand, then it becomes very easy. Over time, you'll learn, as I depicted in recent months, especially with this particular pair here or this market here paired up with the dollar, I gave you specific criteria about how the dollar could maintain its daily range. It would be staying inside this large daily range and still gold could rally. So we had this decline here. trading down to this level here, starts to move higher. Again, I was uncertain about all this until we got to this order block, because then I looked at this as a market maker buy model for the dollar. So here's our original consolidation. We left, came back to the original consolidation distribution, smart money reversal, low risk buy, reaccumulation. Here's the bullish order block. We had multiple instances where we saw that accumulate longs. We hung around in here for a little bit and expanded to the upside here. Then we had our trade, high probability trade. And then it sends us up into our weekly SIBBY, cleaning the buy-sell equity pool of this original consolidation. So this dollar gave me the, I guess the visibility to tell you how we could still stay in this large range, but gold, permit gold to rally still. and we had a really nice sizeable room on the outside. That level of analysis will come with experience. Usually they're diametrically opposed. One goes up, the other one goes down, and vice versa. When we have markets that are in consolidation, you have to really weigh a lot of things and be willing to say, I don't know right now. And I'm very honest with you, when I don't know something, or if I'm not really confident about a specific idea or a directional bias, you've seen I have no shame in telling you right now I don't know I have to wait for more information. These two past market reviews you can see now the things that I'm waiting for. Specific criteria once it happens then I have more insight and I know what I'm wanting to look for. Everything has its time and place. So when we look at model number six don't think that you have to have these things on one hour charts for intraday scalps or four hour charts for day trades. or a daily chart for a one-shot, one-kill or short-term trade, you can use the weekly chart for position swing trades and you literally can capture huge, huge moves. And this is something right out of the mentorship. We talked about it. We've seen the effects of it. And also, if you look at the let's see here. Let's go over here to the cash market. We'll look at gold versus the US dollar and we'll put this on a weekly chart and you'll see there's an absence of that volume imbalance. It becomes a fair value gap. If I can zoom in here. Okay, so here's that original consolidation. Sales off, distribution, distribution, everything matches up over here. Buy, buy, right in here, we have a fair value gap, price trades back down into, closes the fair value gap, there's your accumulation, up to the upside, break, original consolidation. Everything's here, but this area here changes. So where there was a volume imbalance, there isn't a volume imbalance here. Here is a fair value gap. Let me rebalance to this point here. The high on this candle comes in at... 1266 And the low on this candle comes in at 1266. Perfect rebalancing. And then that's prolonged contraction, small range, and then up to the upside, clears the rhythm of consolidation. So as a long-term swing position trader, you can accumulate longs in here and just wait for it to expand on the upside and then capture all the move here. I think if I'm not mistaken, you'll find those comments on video, like I said, in April to the first of June. Look for it in that range, and you should find it. So I'm going to count you to go do that. There's some homework for you. Investigate and find out where that video is for me. But nonetheless, this is the... supplementary idea for model number 6, just applying it to a weekly chart. Nothing new is needed, all we're doing is applying what we've been taught in the original presentation and just applying it to a weekly chart. Now for your further study and understanding, you want to look in these areas right in here where we did our consolidation, compare that with the dollar index. And also compare the lows down here with the dollar index and also compare where we are right now with the dollar index. And I'm referring specifically with SMT and seasonal tendencies. OK, so that's going to be it for this one, guys. I will catch up with you. I'll catch up with you next time when we talk about price action model number six. It will be with the full detailed trading plan in 2020. I'll talk to you next time. Good luck in the trading.

I know some of you have that affinity for that longer term analysis style. So. Right away, you should see this as a market maker buy model.

And the reason why it took me so long getting to this lesson, and I apologize, waiting to the very last day where it can be delivered. So we are on the 31st of July, 2019. And what I was looking for was the lesson in which between April and June, something in there, one of those videos, I mentioned this actual setup here. And I just can't recall exactly which video it was.

I want to talk about how from a long-term perspective, and I'm just going to add some notes on this as we go. I'll just jawbone a little bit as I'm doing it. The gold market. I mentioned at the time of the recording, and again, I don't have the recording on the top of my head right now, but it's in the mentorship library.

Because the commentary I gave was along the lines like this. I was talking about how we did have a smart money reversal, low risk buy, reaccumulation, and the market should accumulate in here, okay, because of this area of distribution. And I mentioned specifically with...

reference to the dollar index that it could go higher for gold, in other words, versus the dollar and the dollar would remain in the range. So that's how I know that the weekly commentary videos has the dimension of it. I just don't recall exactly which one it is, so I'll counsel you to help me find that.

I'd appreciate it because I'd like to be able to add an annotation to this post for other members. But the understanding of the market maker buy model is necessary before we have any understanding of higher time frame long-term position trades. But everything that we talk about in reference to IPTA and market maker models bought by yourself, they're all fractal. That means the things that we look for on one time frame will be the same thing in other time frames.

So we're not really demanding a whole lot of new insight, just understanding the same insights just apply to a longer, higher time frame. Ciao. What I have here is the model itself, the buy model, has been outlined.

So everything to the left of the curve, okay, this is the curve. Everything to the left of it is the sell side of the curve. Everything to the right of the smart money reversal is the buy side of the curve.

All we need to do is look at the points of reference where there's up-close candles on the left-hand side. For folks that are not in the mentorship, that are not formally trained by me, when they see these things, they quickly right away run away with thinking, oh, this is Wyckoff. The application of taking the very points here and bringing them over here, taking this point here and bringing them over here and adding institutional order flow.

That is not Wyckoff. And anyone that's ever studied Wyckoff, and I challenge, if you haven't ever done it, just study it in passing, and you'll see that what we're teaching here is completely beyond the scope of Wyckoff. So what I want you to look at is how everything on this side of the curve, on this weekly chart for gold, is. directly lined up with the previous area of distribution.

So there's no ambiguity, there's no guessing, there's no what supply and demand zones do I look at because it's not supply and demand zones that we're working with. We're looking at specific criteria relative to a model of accumulation and distribution. It goes without saying that the point of equal highs up here is our buy side liquidity. And this would be the area at which we would look for price to want to rebalance.

Okay. In these areas here, we're going to go down to a lower timeframe. Again, this is a weekly chart.

The market will want to seek the buy side liquidity above this high. And you can see we've recently done that. So from the area of accumulation to an area of offset distribution, okay, so we're pairing up buyers. Okay, we're going to buy down here. Why are we buying?

We're rebalancing and we're also mitigating previous shorts. So IPTA is allowing that distribution here to be accumulated and rebalanced. And then after rebalancing, look how much time they spent inside that range. That's accumulation.

Okay, so it feels alien to say it, and I hate sounding like this, but I know it's in the mentorship. But I said that we would be bullish on gold here and look for this to be ran out and still see the dollar index remain in a large range, which is essentially really what it did. But in this area, we can see accumulation, and in this area, we can see accumulation here.

Okay, so. What I'm going to do is I'm going to add one more rectangle in here to kind of like differentiate the areas on the lower time frame that we should be paying attention to. Okay, and now.

But right away you can see there's very handsome amount of points or pips you want to refer to to get from this point here and then reaccumulate some more and then run the buy side liquidity out. So you're buying here looking to sell to willing participants that are willing to buy up here. So we're buying a smart money area and we're selling to an area where there would be buy stops. Which buy side liquidity would be up there?

Large. funds. Because remember they're selling short on gold and this run here, look how much time it takes.

Now again, it's a weekly chart. Every one of these candles represent one week. It takes a great deal of time to get in here and once they accumulate, do they waste time?

No, man. It's a large range that starts kicking off and this is a weekly chart. So let's drop down into a daily and get a taste of what transpired on that time frame. Right in here we have our normal delivery of price inside this area of accumulation. We have a rally higher after seeing support, support here, and we're also looking at the October contract.

Okay, so I'll ask you to go and look at the August contract for gold. We have a rally higher, one big candle, and then we have a complete return back to the bullish order block. And we have a little bit of a fair value gap in there as well. And price accumulates and releases to the upside. Buy side liquidity pull.

Spend some time in here. Comes right back down into, here's our high. Here's our low of the next candle, the red candle.

And here is our fair value gap. All it needs to do is trade down to the low of this candle. The low of that candle is 130.30.6. The low on this candle here. comes down to 130.296, goes one point into the fair value gap.

That is our institutional order flow entry drill entry technique. I go there. Inside and at a deeper discount than what we would be expected to see on the previous sell side of the curve, remember we extended that over here from the weekly, anything in here can be used to accumulate a new long position. market again creates a bullish order block here market expands on the upside trades back down into the bullish order block inside that area Okay, we can accumulate new long positions here or add to what we already accumulated down here and the market Expands and trades above the original consolidation where the large pool of asset liquidity rests So I want you to think about how in this area May, the dollar market, okay, or the dollar, U.S. dollar, became relatively bearish inside of its large trading reach. Okay, and it traded down into June 23rd, I think it was.

Let's see. What is that? June 25th creates the low.

And then we start to trade back to the middle of the range. it starts rallying after we get this breakout here but this low on the 25th of june the 25th of june is where we are here 25th of june is there okay so the low inside the range of the dollar index on its daily chart was here and gold maintained this area around that old equal highs on the daily chart and weekly chart. So the buy side liquidity pool is being consumed. So gold is staying up here allowing the dollar index to come back and rally.

Now we have since taken out the buy side liquidity pool here, closed in our weekly SIBI. So if this were to start trading higher than the weekly CIVI trading into its weekly volume imbalance for the dollar index and again I'll counsel you to do that research yourself look on the weekly chart. Contrast that with how we have traded to this area here on gold if the dollar index at this moment starts to rally higher than 98.40 this will be bearish for gold and gold will want to come back down in here and we'll see what it wants to do if it comes back to this area or not. My concern is they have both moved to a point of buy side liquidity and generally these two markets are inversed or inverted in terms of correlation. Very difficult to decide which one I would want to see happen but if I were looking at the chart I don't feel that we're done on the upside per dollar.

So that to me would indicate that this buy-sell liquidity pool is being used to accumulate short positions. And then they may take these lows out if we get a really long-term prolonged bull move on the dollar. And that's just the conjecture at this moment.

I don't know for certain. I'm just really leaning heavily on the fact that I told you in the mentorship that we would be bullish gold down here and wanting to trade up to this level here. So I think. Zoom out here on the daily chart, you can see we don't have a whole lot of price action because it's spotty.

The liquidity wasn't there until really about in this area, March and May. The reason why I'm talking about October is generally October becomes much more liquid. In other words, the largest open interest goes to October, and we don't really see too much of the August contract.

August contract is Q. You can see a little bit thicker in terms of the candles. All right, moving back to the October contract.

You can see that while October is later in the year, generally you want to be trading nearby contracts, and October is not the nearby contract when we're in like May and June. August is but I generally will roll to October if I'm going to trade gold because and you'll see that October generally has all the open interest You want to compare all this contract nonetheless But you want to be in the October contract if you're going to do any trading or paper trading it so this is what we have for the gold market and to me, I think it's A testimony to what we have already shown multiple times with the market maker buy model, with price action, how price is delivered. And it's also a convincing factor for me when I was coming up and understanding how price is delivered.

All of these factors are leaning on the same principles of market making. Price is offered. to an imbalance, then the imbalance is rebalanced.

So it goes from contraction to expansion to contraction to expansion. From premium to discount to discount to premium. Everything is logical.

There's nothing that's ambiguous when you can see it in price. Now, granted, there's going to be periods of time when you just don't see it. And that's fine.

There are periods where you don't do anything at all. And you don't force it. But when you have things in alignment and you understand, then it becomes very easy. Over time, you'll learn, as I depicted in recent months, especially with this particular pair here or this market here paired up with the dollar, I gave you specific criteria about how the dollar could maintain its daily range. It would be staying inside this large daily range and still gold could rally.

So we had this decline here. trading down to this level here, starts to move higher. Again, I was uncertain about all this until we got to this order block, because then I looked at this as a market maker buy model for the dollar.

So here's our original consolidation. We left, came back to the original consolidation distribution, smart money reversal, low risk buy, reaccumulation. Here's the bullish order block.

We had multiple instances where we saw that accumulate longs. We hung around in here for a little bit and expanded to the upside here. Then we had our trade, high probability trade.

And then it sends us up into our weekly SIBBY, cleaning the buy-sell equity pool of this original consolidation. So this dollar gave me the, I guess the visibility to tell you how we could still stay in this large range, but gold, permit gold to rally still. and we had a really nice sizeable room on the outside.

That level of analysis will come with experience. Usually they're diametrically opposed. One goes up, the other one goes down, and vice versa. When we have markets that are in consolidation, you have to really weigh a lot of things and be willing to say, I don't know right now. And I'm very honest with you, when I don't know something, or if I'm not really confident about a specific idea or a directional bias, you've seen I have no shame in telling you right now I don't know I have to wait for more information.

These two past market reviews you can see now the things that I'm waiting for. Specific criteria once it happens then I have more insight and I know what I'm wanting to look for. Everything has its time and place.

So when we look at model number six don't think that you have to have these things on one hour charts for intraday scalps or four hour charts for day trades. or a daily chart for a one-shot, one-kill or short-term trade, you can use the weekly chart for position swing trades and you literally can capture huge, huge moves. And this is something right out of the mentorship.

We talked about it. We've seen the effects of it. And also, if you look at the let's see here. Let's go over here to the cash market.

We'll look at gold versus the US dollar and we'll put this on a weekly chart and you'll see there's an absence of that volume imbalance. It becomes a fair value gap. If I can zoom in here. Okay, so here's that original consolidation. Sales off, distribution, distribution, everything matches up over here.

Buy, buy, right in here, we have a fair value gap, price trades back down into, closes the fair value gap, there's your accumulation, up to the upside, break, original consolidation. Everything's here, but this area here changes. So where there was a volume imbalance, there isn't a volume imbalance here. Here is a fair value gap. Let me rebalance to this point here.

The high on this candle comes in at... 1266 And the low on this candle comes in at 1266. Perfect rebalancing. And then that's prolonged contraction, small range, and then up to the upside, clears the rhythm of consolidation.

So as a long-term swing position trader, you can accumulate longs in here and just wait for it to expand on the upside and then capture all the move here. I think if I'm not mistaken, you'll find those comments on video, like I said, in April to the first of June. Look for it in that range, and you should find it. So I'm going to count you to go do that.

There's some homework for you. Investigate and find out where that video is for me. But nonetheless, this is the... supplementary idea for model number 6, just applying it to a weekly chart.

Nothing new is needed, all we're doing is applying what we've been taught in the original presentation and just applying it to a weekly chart. Now for your further study and understanding, you want to look in these areas right in here where we did our consolidation, compare that with the dollar index. And also compare the lows down here with the dollar index and also compare where we are right now with the dollar index.

And I'm referring specifically with SMT and seasonal tendencies. OK, so that's going to be it for this one, guys. I will catch up with you. I'll catch up with you next time when we talk about price action model number six. It will be with the full detailed trading plan in 2020. I'll talk to you next time.

Good luck in the trading.

Transcript for:Strategies for Market Maker Models

Transcript for:
Strategies for Market Maker Models