High Probability Day Trading Strategies

Welcome back folks, this is Lesson 7 of the ICT Day Trading Model, High Probability Day Trade Setups. Okay, what makes day trades high probability? The highest importance is placed on the higher time frame daily and or 4-hour direction. When daily and or 4-hour direction is bullish, use previous days low to high. for retracement entries. Use previous days New York session low to high for retracement entries. Use previous days low for cell stop rate to accumulate lungs. Focusing on the anticipated move from higher time frame discount to premium PDA raise. When daily and or four hour direction is bearish, use previous days high to low. for retracement entries. Use previous days New York session high to low for retracement entries. Use previous days high for buy stop rate accumulate shorts focusing on the anticipated move from the higher time frame premium to discount PDA raise. When we're looking for high probability day trades what we're really focusing on is where's the next most likely direction. higher or lower, and off of what level and trading up to what level for a profit. There's several swings that you need to be aware of. Obviously, the previous day's high and low. The previous day's New York session range from high to low. That means the session's highest high and the lowest low during the New York trading hours. There's also one that's not listed here. But I want you to think about what's the highest high and the lowest low during the London session? That means the London high and the London low for the London Kill Zone. Then also looking at the London high or low to the low or high contrary to it. In other words, the total range from the London session extreme, whether it be a high or low. to the low or high prior to the New York session beginning. So between New York opening, what's the extreme on the range for that day in London? Is it high or low relative to the beginning of New York session? That range also is important. When we look through price and we find opportunities to be a day trader, You're looking for the similar things we went over on the higher time frame charts just on a lower time frame. Nothing that you see on the lower time frame is going to be any different from what we've outlined from what we've seen in the daily or weekly or monthly. Every example that's being outlined here for framing a high probability setup, this is not the panacea list. Okay, this isn't. This is not going to be every possible scenario. These are the criterias that I look for each trading day when the conditions are ripe. So in other words, I've done my due diligence, if you will, from the higher time frame, and I've arrived at what I believe is the most probable direction on a higher time frame chart. And then what I'll look for is, if I'm bullish, I want to look for the range from London's extreme high or low to that which… The opposite extreme, high or low, would be prior to New York. So whatever the range is from London to right before New York opening, that's important. I want to measure that range. If I'm bearish, that range is going to help me find the next trading day retracement up. During that protractionary state, that move up is going to be a retracement into that London session range from London going into the beginning of New York. I'll also measure the New York session range, high and low. That also many times will give me the setup that's framed for the next day's high or low. It'll be a retracement inside that range. I'll look for the previous day's high and low. to look for stop rates generally you're going to see those scenarios occur when there is an end to a most recent move in other words if we've seen several days go up it's going to go up into a premium array and it's probably going to trade above an old high i'll look for a buy stop run there and then go short the next day vice versa if the market's been trading lower and it trades down to a discount pd array I'll look for the market to trade down below a previous day's low. I'll buy the sell stops, and I'll use that as a day trade. Daily and for-hour, when we use those independently or in concert with one another to build our bearish or bullish ideas, what we're looking for is the price analysis of seeing is price supporting bullishness, or is it bouncing off of bullish order blocks? Is it rejecting old lows and showing a willingness to go higher? Is it filling in gaps below us and then rallying? Those ideas are the first things that we look for. Then are we seeing short-term premium arrays violating? If that's occurring, then it's bullish. Institutional overflows is bullish. And the opposite is said in reverse when you're bearish. When do I look to buy for day trades? Ideally in seasonal periods of the year, but it's not required, but ideally it has to make the list in here because this is the high probability series. When the current quarter or new quarter is expected to be bullish after the daily chart has reacted positively on a discount PDR. It could be a bullish order block, any of the discount arrays that's known to you by the PDR matrix. When price has a clear. Unobscured path to an opposing premium array. In other words, it's very easily seen what it would reach for above you presently. If you can't see it very easily, it's probably not going to be a high probability setup. The ideal days of the week buying are Monday, Tuesday, and Wednesday. You refer to the central bank dealer's range and determine if it's less than 40 pips ideally. And we're going to demand that the Asian range is in a 20 pip range or less ahead of the Frankfurt opening. Buying between 2 a.m. and 4 a.m. New York time, we're going to be seeking the low of the day. We're going to be buying at 1 to 2 standard deviations of Central Bank Dealers Range and or Asian range coupled with a discount PDR. The time frame we're going to execute on is a 15 and or. Five minute chart now, where do I look to buy for day trades? I like buying under the Asian range plus five pips for the spread I like looking for fair value gaps below a short-term low from the previous days New York session in other words after New York opens up I'm looking for short-term lows that form going into the close of the start of a new day zero GMT I look back in the previous day's range. In the New York session, generally, you're going to find a low. And if we can drop down into that in London, I'll look for those sell stops to be triggered. And then I'll go long from that. But it has to overlap with other things. Central Bank dealer's range, Asian range, those ideas. Also, it has to be in time of day. London open kill zone. Bullish order block that resides below a short-term low. either in the previous day or intraday today. In other words, it could be a short-term or intraday low that formed, and then it trades lower than that into a bullish order block. That's a very, very strong condition when the overall picture is bullish. I would be buying in that scenario during London. If I'm very bullish, I'll trade long at one standard deviation below the central bank dealer's range or Asian range, and any discount PDRA overlap. while in the London Kill Zone. Inside the protraction, lower post 12 a.m. to 2 a.m. with IPTA. In other words, it's trading down. I'm going to be looking to go long during that Judah swing. And again, it has to be an overlap with a discount PD array. Filling a liquidity void that completes. Under a short-term low, in other words, what we saw on the second setup, fair value gap, it could be a larger gap, which would be basically a liquidity void that would be completed or filled in below a short-term low. So what we're doing is we're really trying to buy below lows, looking to accumulate sell-stop liquidity that we can buy from. If after rally post 12 a.m. New York time. Buy the first retracement into a 15 and or 5 minute bullish order block. So in other words, what I'm saying here is if we have rallied right after midnight, we didn't see any drop down or protractionary state that would put us into a discount. If it's been rallying straight up, if we get into the 2 o'clock to 4 o'clock time period of day, London kill zone, sweet spot if you will, I'll buy the first retracement down to a bullish order block on a 5 or 15 minute basis. one to two standard deviations in the Asian range coupled with discount PDA. In other words, I'm looking for two or one standard deviation drops of the Asian range total range down, and it's going to be overlapping with a discount PDA. So I'm blending those two. If a short-term low is taken out twice but there has been no upside protractionary state, In other words, we haven't seen the market go up first, then go down twice. The second time in that condition, it's probably going to keep on going lower. But if it has not seen any protractionary move on the upside or due to swing up, we go down for a low and then one more time blow out that low. I'll buy that as a turtle suit. Now, what are outlined here are my favorite setups. These are the conditions, and you have to find them in examples. I could show you examples. But nonetheless, that's not going to help you. These are the frameworks I look for. In other words, if I see these types of scenarios unfold, generally these are the ones that typically get into my thought process. I'm looking for certain things to line up certain some type of play. Or, for instance, if we were a sports team, OK, and the coach has a playbook and he likes certain plays that he makes his players go through. Well, these are the scenarios I love when it comes to trading the London Open. These are my toolbox for consistency. These types of trades form several times a week. If you look for a few of them and understand what they are, when the market's bullish, we've shown willingness to respect a daily discount PDR. One of these criteria are going to meet. Every. London session out there will have something in this list that forms. Now, I already know what you're going to think. Wow, Michael, this is a lot. Which one do I pick? Well, if you study them, they all don't have the same characteristics. It depends on what the market's providing you. So when you're watching 12 a.m. New York time, we're watching to see which scenario unfolds. Remember, we're looking for that initial drop down ideally. But if it doesn't happen... We have one condition here where it says if it rallies straight from 12 a.m., when we get to 2 a.m., we're going to buy the first retracement into a 15 or 5-minute order block. Boom, it's over. So you got every scenario that I would be looking for for a little bit of an open long. Placing stop losses in a buy for day trades. Whatever you do. And whatever you use for your initial stop loss, do not rush moving it. I already know what you're trying to do. You want to get to break even, plus 5, plus 20. Forget that in day trading in London because you can get a double pass. They can come back and knock you out, and you'll miss the entire move. Leave your stop at initial until you get to at least 40% to 50% of the daily range. If you can get that in London, then bring it to break even. But anything prior to that, don't do it. If you're trading in Central Bank Dealers Range Overlap with a PD array, the stop has to be 30 pips under your entry. If you're trading a run under the Asian range, in other words, what we're doing is watching price trade down below the Asian range. It might be one standard deviation, might go half of one full standard deviation. Anything below Asian range low, your stop needs to be 40 pips below your entry. If you're trading any sell stop rate, 30 pips under the low of the entry you're using. In other words, you're going to use the low as your primary entry point. That low, you're going to try to enter below that. Your stop has to be 30 pips below that low. If you're trading the first retracement into a bullish order block, you have to be 10 pips under the lowest low of the day. If you're trading the second return for sell stops, in other words, we've had a move lower, and then it moves lower one more time, takes out the sell stops, your stop has to be below that 30 pips. Again, that one is if you don't see any move right away after midnight, if it's only been a straight down move, and then it goes down one more time below the low that's formed initially, your stop has to be 30 pips below that if you're buying that as a turtle suit. If you're trading any other setup not described above, what you're going to be using is 50% of the average daily range of the last five days subtracted from the Asian range low. Assuming you have a 100 pip average daily range for the last five days, what you're going to do is take 50 pips minus the Asian range low. Whatever that price is, that's what your stop loss has to be. Taking profits in buy day trades. Hey, you're always going to try to take something off in gain at 20 to 30 pips. Always do this in London. You're going to look to scale something off every two standard deviations of the Asian range or central bank dealer's range. Yes, I said it requires you to see two standard deviations before you take the next level of profit. That means after your first 20 to 30 pips, you're going to wait for two standard deviations of the Asian range or central bank dealer's range. Then you take something off again. Take something off at the previous day's high plus 5 to 15 pips because you could end up in a turtle soup scenario and it could retrace on you. Take something off at 50% of the price range you're trading in on a 60-minute basis. In other words, inside the range, where are we at? If we rally up inside that range, remember equilibrium could be an impactful level. So you want to take something off there as well because it could be. take or have had taken 60 to 80 percent off at five day average daily range projections always do this so in other words basically if you've not taken off anything except for the first 20 30 pips you didn't do anything for two standard deviations of the asian range or central bank dealer trains because maybe it didn't do that maybe it hasn't fulfilled that maybe you haven't done anything with a previous day's high hasn't traded there yet and Maybe you haven't seen a 50% range in the last 60 minutes price action. Then you have to consider average daily range the last five days. You need to be taking at least 60% to 80% off at that point. Always do this. And then you can leave a little portion on to see if you're going to get more juice out of that lemon and hold for a later portion of the day. If trading higher than the previous trading week. take something off there because you could get a turtle soup scenario in that environment. If trading higher than a previous month's high, take something off there. In time of day, scale out something at or just above the 5 o'clock hour New York time. In time of day, you want to scale out a short-term high prior to the 7 a.m. New York open. Let me outline this again. These are time-day specific. You want to take some profit when it's bullish and you've been rallying. Whatever that short-term high that's forming prior to 7 a.m., that means there's going to be a short-term little rally going into 7 o'clock. Whatever that high is, as it's rallying, you want to take something off there because New York could be a reversal. In time of day, look to scale out between 10 a.m. and 11 a.m. New York time during the rally. So in other words… Whenever price is moving up at 10 a.m., that leg in price higher, you want to be exiting and taking something out as it's rallying up. Ideally, any of the above scenarios coupled with a PD array in a premium basis. Now, obviously, you're probably saying, well, Michael, I only did two minis. I can only afford to do that. How can I take this many portions off? You can't. But if you look at it again, study it. Not all these conditions can be present, but you want to look for the ones that may potentially be there for you. You can go through this list and look at your trade as you get ready to take it and see right away if any of these are going to be potential candidates. But you have to take profits on these rules. That's how I do it. This is the reason why I do it. And when you see me taking positions and scaling them off, this is the criteria I'm using. When do I look to short day trades? Ideally in seasonal bearish periods of the year, but it's not required. When the current quarter or new quarter is expected bearish. After the daily chart has reacted positively on a premium PD array. When price has a clear, unobstructed path to an opposing discount array. The ideal days of the week shorting are Monday, Tuesday, and Wednesday. Refer to the central bank dealer's range and determine if it's less than 40 pips ideally. Demand the Asian range to be in a 20-pip range or less ahead of the Frankfurt opening. That's basically 1 o'clock in the morning New York time. It's early London. Shorting between 2 a.m. and 4 a.m. New York time seeking the high of the day. Generally, I'm looking to sell one to two standard deviations of the central bank dealer's range and or Asian range coupled with a premium PD array. Time frame to execute on is either five or 15 minute time frame. Where do I look to short day trades? I like to run above the Asian range, at least five pips above it. I want to be selling short there. A fair value gap above a short-term high from the previous day's New York session. There's going to be buy stops above that. I'll look to sell that as it rallies above that in the New York session. Bearish order block above a short-term high either previous day or today. In other words, if there's a bearish order block that resides in price action and there's a short-term high just below that we haven't rated yet. Soon as we trade above that short-term high and into that bearish order block, if it does that during London session, I'll go short there. If I'm very bearish, one standard deviation with any premium PD array in the London open kill zone, I can trade on that. Inside the protraction, higher post 12 a.m. midnight New York time to 2 a.m. New York time with a PD array or a... premium PDR rate specifically, that's enough for me. So basically I'm looking at a Judas swing that occurs right from midnight going up into 2 a.m. It can happen prior to 2 a.m., but generally you want to see that move right after 12 a.m. up. It trades into a premium PDR rate. That's enough to get short. Filling a liquidity void that completes above a short-term high. If after The drop post 12 a.m. I'm going to sell the first retracement into a 15 or 5 minute bearish order block. One to two standard deviations in the Asian range coupled with a premium PD array. I can sell that. And if short term high is taken out twice with no initial downside. I'll sell that as a turtle soup. Placing stop losses in short day trades. Whenever you use the initial stop loss, obviously don't be in a rush to move that. We've said that in the buy side. It's the same thing here for shorting. If you're trading the central bank dealer's range overlap with a PDA, stop must be 30 pips above your entry. If you're trading a run above the Asian range high, The stop has to be 40 pips. If you're trading any buy stop rate, your stop has to be 30 pips above the high or your entry. If you're trading the first retracement into a bearish order block, your stop has to be 10 pips above the highest high of the day. If you're trading the second return for buy stops or basically a turtle suit. and we have not seen an immediate rally lower in price after midnight, your stop has to be 30 pips above the highest high of the day. If you're trading any other setup not described above, use 50% of the average daily range of the last five days added to the Asian range high. Taking profits in short day trades. Always try to take something off and gain at 20 to 30 pips, always. Look to scale something off every two standard deviations in the Asian range or central bank dealer's range. Take something off at the previous day's low, minus 5 to 15 pips. Take something off at the 50% range or equilibrium of the price range you are trading inside of on a 60-minute chart. Take or have taken 60 to 80% off at the average daily range of the last five days. Do this always. If trading lower than the previous trading week's low, take something off there. You could have a reversal or rejection. If trading lower than the previous month's low, again, this could be a potential reversal. So you want to take something off there. In time of day, scale out something. At or prior to 5 a.m. New York time in time of day, scale out a short-term low prior to 7 a.m. New York open. In other words, New York open could be a reversal or generally a retracement into the 8.20 CME opening. So you want to be seeing profit-taking, some measure of portion come off as profit as it's accelerating lower ahead of 7 a.m. In time of day, scale out. At 10 a.m. to 11 a.m. New York time, while price is still declining, ideally any of the above scenarios coupled with a premium PD array. Now, obviously, I've given you several instances and circumstances and outlines for the probable plan of action, whether you're entering, whether you're taking profit, where you're using your stop at. These are. my general rules of operation. This is what I generally look for. These are the things I do, how I manage the position, what I'm doing initially with the stops, where I'm looking to take profits at. The ones that I did not incorporate here were obviously been taught in other places, so I didn't have to rehash or put in filler. Any projection on the FIB, 127, 168, and the 100% symmetrical price swing. Or 100% move, measured move. Those ideas, coupled with any of these as well, really amplifies for profit taking. This lesson, obviously, I don't want to see it on YouTube. And if it ends up on YouTube, I'll have it pulled down. But the lesson itself, I could pretty much show this on baby pips. And nobody would understand what it's talking about. So. That's the reason why I went through a great deal of information in January and all the way up to now, because you know all the elements that's being described here, or you should know them because you've studied all the previous months. The criteria and the rules of engagement that's being explained and outlined for both sides of buying and selling, not every single one of these are going to be usable. You can't use every single one of them. They're not going to be applicable to every trade that you're in. So don't think because there's a laundry list of things and scenarios here, not all of them are going to be able to be applied to your trade. But knowing what they are in advance in outline form here, you can already see how you can look to see if it's going to be a probable scenario for your particular trade idea. You may not be trading anywhere near a weekly low. You may not be trading anywhere near a monthly low. So they may not even be any consideration at all. You probably already took something off at 20 to 30 pips, and it hasn't much moved beyond that going into 5 a.m. New York time. So you wouldn't consider that either. The scaling out ahead of 7 a.m., maybe you have taken 20 or 30 pips already in London, and then it went the whole full average daily range all during London. You're not going to take something ahead of 7 a.m. on that because you've already taken something based on average daily range being fulfilled. Looking at the scenarios that would potentially... paying out here and also for the entries. Again, not all of them will be applicable. So don't freak out because it seems like a whole lot. And yes, you're being challenged. I promised you in the latter lessons, you're going to have to think. You have to think for yourself. You have to have rules. You have to look for these types of things yourself in the charts. They all won't be there. So you're not having to look through all these things to whittle down to what you should be doing for your trade. All of the... criteria that's been listed here for the setups, the buys, the sells, where your stop loss is. There are specific rules for all of that. I have specific outlined scenarios in this teaching that if you stick to them, you'll do everything that I do on a week-by-week basis when I'm trading. So yes, it requires you to think. Yes, it's a little bit of work, but is it worth it? Absolutely. And until next time, wish you good luck and good trading.

When daily and or 4-hour direction is bullish, use previous days low to high. for retracement entries. Use previous days New York session low to high for retracement entries.

Use previous days low for cell stop rate to accumulate lungs. Focusing on the anticipated move from higher time frame discount to premium PDA raise. When daily and or four hour direction is bearish, use previous days high to low.

for retracement entries. Use previous days New York session high to low for retracement entries. Use previous days high for buy stop rate accumulate shorts focusing on the anticipated move from the higher time frame premium to discount PDA raise. When we're looking for high probability day trades what we're really focusing on is where's the next most likely direction.

higher or lower, and off of what level and trading up to what level for a profit. There's several swings that you need to be aware of. Obviously, the previous day's high and low.

The previous day's New York session range from high to low. That means the session's highest high and the lowest low during the New York trading hours. There's also one that's not listed here. But I want you to think about what's the highest high and the lowest low during the London session?

That means the London high and the London low for the London Kill Zone. Then also looking at the London high or low to the low or high contrary to it. In other words, the total range from the London session extreme, whether it be a high or low. to the low or high prior to the New York session beginning. So between New York opening, what's the extreme on the range for that day in London?

Is it high or low relative to the beginning of New York session? That range also is important. When we look through price and we find opportunities to be a day trader, You're looking for the similar things we went over on the higher time frame charts just on a lower time frame. Nothing that you see on the lower time frame is going to be any different from what we've outlined from what we've seen in the daily or weekly or monthly. Every example that's being outlined here for framing a high probability setup, this is not the panacea list.

Okay, this isn't. This is not going to be every possible scenario. These are the criterias that I look for each trading day when the conditions are ripe.

So in other words, I've done my due diligence, if you will, from the higher time frame, and I've arrived at what I believe is the most probable direction on a higher time frame chart. And then what I'll look for is, if I'm bullish, I want to look for the range from London's extreme high or low to that which… The opposite extreme, high or low, would be prior to New York. So whatever the range is from London to right before New York opening, that's important.

I want to measure that range. If I'm bearish, that range is going to help me find the next trading day retracement up. During that protractionary state, that move up is going to be a retracement into that London session range from London going into the beginning of New York. I'll also measure the New York session range, high and low.

That also many times will give me the setup that's framed for the next day's high or low. It'll be a retracement inside that range. I'll look for the previous day's high and low. to look for stop rates generally you're going to see those scenarios occur when there is an end to a most recent move in other words if we've seen several days go up it's going to go up into a premium array and it's probably going to trade above an old high i'll look for a buy stop run there and then go short the next day vice versa if the market's been trading lower and it trades down to a discount pd array I'll look for the market to trade down below a previous day's low.

I'll buy the sell stops, and I'll use that as a day trade. Daily and for-hour, when we use those independently or in concert with one another to build our bearish or bullish ideas, what we're looking for is the price analysis of seeing is price supporting bullishness, or is it bouncing off of bullish order blocks? Is it rejecting old lows and showing a willingness to go higher? Is it filling in gaps below us and then rallying?

Those ideas are the first things that we look for. Then are we seeing short-term premium arrays violating? If that's occurring, then it's bullish. Institutional overflows is bullish. And the opposite is said in reverse when you're bearish.

When do I look to buy for day trades? Ideally in seasonal periods of the year, but it's not required, but ideally it has to make the list in here because this is the high probability series. When the current quarter or new quarter is expected to be bullish after the daily chart has reacted positively on a discount PDR.

It could be a bullish order block, any of the discount arrays that's known to you by the PDR matrix. When price has a clear. Unobscured path to an opposing premium array. In other words, it's very easily seen what it would reach for above you presently.

If you can't see it very easily, it's probably not going to be a high probability setup. The ideal days of the week buying are Monday, Tuesday, and Wednesday. You refer to the central bank dealer's range and determine if it's less than 40 pips ideally.

And we're going to demand that the Asian range is in a 20 pip range or less ahead of the Frankfurt opening. Buying between 2 a.m. and 4 a.m. New York time, we're going to be seeking the low of the day. We're going to be buying at 1 to 2 standard deviations of Central Bank Dealers Range and or Asian range coupled with a discount PDR.

The time frame we're going to execute on is a 15 and or. Five minute chart now, where do I look to buy for day trades? I like buying under the Asian range plus five pips for the spread I like looking for fair value gaps below a short-term low from the previous days New York session in other words after New York opens up I'm looking for short-term lows that form going into the close of the start of a new day zero GMT I look back in the previous day's range. In the New York session, generally, you're going to find a low. And if we can drop down into that in London, I'll look for those sell stops to be triggered.

And then I'll go long from that. But it has to overlap with other things. Central Bank dealer's range, Asian range, those ideas. Also, it has to be in time of day.

London open kill zone. Bullish order block that resides below a short-term low. either in the previous day or intraday today. In other words, it could be a short-term or intraday low that formed, and then it trades lower than that into a bullish order block.

That's a very, very strong condition when the overall picture is bullish. I would be buying in that scenario during London. If I'm very bullish, I'll trade long at one standard deviation below the central bank dealer's range or Asian range, and any discount PDRA overlap. while in the London Kill Zone.

Inside the protraction, lower post 12 a.m. to 2 a.m. with IPTA.

In other words, it's trading down. I'm going to be looking to go long during that Judah swing. And again, it has to be an overlap with a discount PD array. Filling a liquidity void that completes. Under a short-term low, in other words, what we saw on the second setup, fair value gap, it could be a larger gap, which would be basically a liquidity void that would be completed or filled in below a short-term low.

So what we're doing is we're really trying to buy below lows, looking to accumulate sell-stop liquidity that we can buy from. If after rally post 12 a.m. New York time.

Buy the first retracement into a 15 and or 5 minute bullish order block. So in other words, what I'm saying here is if we have rallied right after midnight, we didn't see any drop down or protractionary state that would put us into a discount. If it's been rallying straight up, if we get into the 2 o'clock to 4 o'clock time period of day, London kill zone, sweet spot if you will, I'll buy the first retracement down to a bullish order block on a 5 or 15 minute basis. one to two standard deviations in the Asian range coupled with discount PDA. In other words, I'm looking for two or one standard deviation drops of the Asian range total range down, and it's going to be overlapping with a discount PDA.

So I'm blending those two. If a short-term low is taken out twice but there has been no upside protractionary state, In other words, we haven't seen the market go up first, then go down twice. The second time in that condition, it's probably going to keep on going lower.

But if it has not seen any protractionary move on the upside or due to swing up, we go down for a low and then one more time blow out that low. I'll buy that as a turtle suit. Now, what are outlined here are my favorite setups. These are the conditions, and you have to find them in examples. I could show you examples.

But nonetheless, that's not going to help you. These are the frameworks I look for. In other words, if I see these types of scenarios unfold, generally these are the ones that typically get into my thought process. I'm looking for certain things to line up certain some type of play. Or, for instance, if we were a sports team, OK, and the coach has a playbook and he likes certain plays that he makes his players go through.

Well, these are the scenarios I love when it comes to trading the London Open. These are my toolbox for consistency. These types of trades form several times a week. If you look for a few of them and understand what they are, when the market's bullish, we've shown willingness to respect a daily discount PDR.

One of these criteria are going to meet. Every. London session out there will have something in this list that forms.

Now, I already know what you're going to think. Wow, Michael, this is a lot. Which one do I pick? Well, if you study them, they all don't have the same characteristics.

It depends on what the market's providing you. So when you're watching 12 a.m. New York time, we're watching to see which scenario unfolds.

Remember, we're looking for that initial drop down ideally. But if it doesn't happen... We have one condition here where it says if it rallies straight from 12 a.m., when we get to 2 a.m., we're going to buy the first retracement into a 15 or 5-minute order block.

Boom, it's over. So you got every scenario that I would be looking for for a little bit of an open long. Placing stop losses in a buy for day trades.

Whatever you do. And whatever you use for your initial stop loss, do not rush moving it. I already know what you're trying to do. You want to get to break even, plus 5, plus 20. Forget that in day trading in London because you can get a double pass. They can come back and knock you out, and you'll miss the entire move.

Leave your stop at initial until you get to at least 40% to 50% of the daily range. If you can get that in London, then bring it to break even. But anything prior to that, don't do it. If you're trading in Central Bank Dealers Range Overlap with a PD array, the stop has to be 30 pips under your entry.

If you're trading a run under the Asian range, in other words, what we're doing is watching price trade down below the Asian range. It might be one standard deviation, might go half of one full standard deviation. Anything below Asian range low, your stop needs to be 40 pips below your entry.

If you're trading any sell stop rate, 30 pips under the low of the entry you're using. In other words, you're going to use the low as your primary entry point. That low, you're going to try to enter below that.

Your stop has to be 30 pips below that low. If you're trading the first retracement into a bullish order block, you have to be 10 pips under the lowest low of the day. If you're trading the second return for sell stops, in other words, we've had a move lower, and then it moves lower one more time, takes out the sell stops, your stop has to be below that 30 pips. Again, that one is if you don't see any move right away after midnight, if it's only been a straight down move, and then it goes down one more time below the low that's formed initially, your stop has to be 30 pips below that if you're buying that as a turtle suit.

If you're trading any other setup not described above, what you're going to be using is 50% of the average daily range of the last five days subtracted from the Asian range low. Assuming you have a 100 pip average daily range for the last five days, what you're going to do is take 50 pips minus the Asian range low. Whatever that price is, that's what your stop loss has to be.

Taking profits in buy day trades. Hey, you're always going to try to take something off in gain at 20 to 30 pips. Always do this in London.

You're going to look to scale something off every two standard deviations of the Asian range or central bank dealer's range. Yes, I said it requires you to see two standard deviations before you take the next level of profit. That means after your first 20 to 30 pips, you're going to wait for two standard deviations of the Asian range or central bank dealer's range. Then you take something off again. Take something off at the previous day's high plus 5 to 15 pips because you could end up in a turtle soup scenario and it could retrace on you.

Take something off at 50% of the price range you're trading in on a 60-minute basis. In other words, inside the range, where are we at? If we rally up inside that range, remember equilibrium could be an impactful level. So you want to take something off there as well because it could be.

take or have had taken 60 to 80 percent off at five day average daily range projections always do this so in other words basically if you've not taken off anything except for the first 20 30 pips you didn't do anything for two standard deviations of the asian range or central bank dealer trains because maybe it didn't do that maybe it hasn't fulfilled that maybe you haven't done anything with a previous day's high hasn't traded there yet and Maybe you haven't seen a 50% range in the last 60 minutes price action. Then you have to consider average daily range the last five days. You need to be taking at least 60% to 80% off at that point. Always do this.

And then you can leave a little portion on to see if you're going to get more juice out of that lemon and hold for a later portion of the day. If trading higher than the previous trading week. take something off there because you could get a turtle soup scenario in that environment.

If trading higher than a previous month's high, take something off there. In time of day, scale out something at or just above the 5 o'clock hour New York time. In time of day, you want to scale out a short-term high prior to the 7 a.m.

New York open. Let me outline this again. These are time-day specific.

You want to take some profit when it's bullish and you've been rallying. Whatever that short-term high that's forming prior to 7 a.m., that means there's going to be a short-term little rally going into 7 o'clock. Whatever that high is, as it's rallying, you want to take something off there because New York could be a reversal.

In time of day, look to scale out between 10 a.m. and 11 a.m. New York time during the rally. So in other words… Whenever price is moving up at 10 a.m., that leg in price higher, you want to be exiting and taking something out as it's rallying up. Ideally, any of the above scenarios coupled with a PD array in a premium basis.

Now, obviously, you're probably saying, well, Michael, I only did two minis. I can only afford to do that. How can I take this many portions off?

You can't. But if you look at it again, study it. Not all these conditions can be present, but you want to look for the ones that may potentially be there for you. You can go through this list and look at your trade as you get ready to take it and see right away if any of these are going to be potential candidates. But you have to take profits on these rules.

That's how I do it. This is the reason why I do it. And when you see me taking positions and scaling them off, this is the criteria I'm using.

When do I look to short day trades? Ideally in seasonal bearish periods of the year, but it's not required. When the current quarter or new quarter is expected bearish. After the daily chart has reacted positively on a premium PD array. When price has a clear, unobstructed path to an opposing discount array.

The ideal days of the week shorting are Monday, Tuesday, and Wednesday. Refer to the central bank dealer's range and determine if it's less than 40 pips ideally. Demand the Asian range to be in a 20-pip range or less ahead of the Frankfurt opening. That's basically 1 o'clock in the morning New York time. It's early London.

Shorting between 2 a.m. and 4 a.m. New York time seeking the high of the day.

Generally, I'm looking to sell one to two standard deviations of the central bank dealer's range and or Asian range coupled with a premium PD array. Time frame to execute on is either five or 15 minute time frame. Where do I look to short day trades? I like to run above the Asian range, at least five pips above it. I want to be selling short there.

A fair value gap above a short-term high from the previous day's New York session. There's going to be buy stops above that. I'll look to sell that as it rallies above that in the New York session. Bearish order block above a short-term high either previous day or today. In other words, if there's a bearish order block that resides in price action and there's a short-term high just below that we haven't rated yet.

Soon as we trade above that short-term high and into that bearish order block, if it does that during London session, I'll go short there. If I'm very bearish, one standard deviation with any premium PD array in the London open kill zone, I can trade on that. Inside the protraction, higher post 12 a.m.

midnight New York time to 2 a.m. New York time with a PD array or a... premium PDR rate specifically, that's enough for me.

So basically I'm looking at a Judas swing that occurs right from midnight going up into 2 a.m. It can happen prior to 2 a.m., but generally you want to see that move right after 12 a.m. up. It trades into a premium PDR rate.

That's enough to get short. Filling a liquidity void that completes above a short-term high. If after The drop post 12 a.m.

I'm going to sell the first retracement into a 15 or 5 minute bearish order block. One to two standard deviations in the Asian range coupled with a premium PD array. I can sell that.

And if short term high is taken out twice with no initial downside. I'll sell that as a turtle soup. Placing stop losses in short day trades.

Whenever you use the initial stop loss, obviously don't be in a rush to move that. We've said that in the buy side. It's the same thing here for shorting. If you're trading the central bank dealer's range overlap with a PDA, stop must be 30 pips above your entry. If you're trading a run above the Asian range high, The stop has to be 40 pips.

If you're trading any buy stop rate, your stop has to be 30 pips above the high or your entry. If you're trading the first retracement into a bearish order block, your stop has to be 10 pips above the highest high of the day. If you're trading the second return for buy stops or basically a turtle suit. and we have not seen an immediate rally lower in price after midnight, your stop has to be 30 pips above the highest high of the day. If you're trading any other setup not described above, use 50% of the average daily range of the last five days added to the Asian range high.

Taking profits in short day trades. Always try to take something off and gain at 20 to 30 pips, always. Look to scale something off every two standard deviations in the Asian range or central bank dealer's range. Take something off at the previous day's low, minus 5 to 15 pips.

Take something off at the 50% range or equilibrium of the price range you are trading inside of on a 60-minute chart. Take or have taken 60 to 80% off at the average daily range of the last five days. Do this always.

If trading lower than the previous trading week's low, take something off there. You could have a reversal or rejection. If trading lower than the previous month's low, again, this could be a potential reversal.

So you want to take something off there. In time of day, scale out something. At or prior to 5 a.m.

New York time in time of day, scale out a short-term low prior to 7 a.m. New York open. In other words, New York open could be a reversal or generally a retracement into the 8.20 CME opening.

So you want to be seeing profit-taking, some measure of portion come off as profit as it's accelerating lower ahead of 7 a.m. In time of day, scale out. At 10 a.m. to 11 a.m.

New York time, while price is still declining, ideally any of the above scenarios coupled with a premium PD array. Now, obviously, I've given you several instances and circumstances and outlines for the probable plan of action, whether you're entering, whether you're taking profit, where you're using your stop at. These are.

my general rules of operation. This is what I generally look for. These are the things I do, how I manage the position, what I'm doing initially with the stops, where I'm looking to take profits at. The ones that I did not incorporate here were obviously been taught in other places, so I didn't have to rehash or put in filler.

Any projection on the FIB, 127, 168, and the 100% symmetrical price swing. Or 100% move, measured move. Those ideas, coupled with any of these as well, really amplifies for profit taking. This lesson, obviously, I don't want to see it on YouTube.

And if it ends up on YouTube, I'll have it pulled down. But the lesson itself, I could pretty much show this on baby pips. And nobody would understand what it's talking about.

So. That's the reason why I went through a great deal of information in January and all the way up to now, because you know all the elements that's being described here, or you should know them because you've studied all the previous months. The criteria and the rules of engagement that's being explained and outlined for both sides of buying and selling, not every single one of these are going to be usable.

You can't use every single one of them. They're not going to be applicable to every trade that you're in. So don't think because there's a laundry list of things and scenarios here, not all of them are going to be able to be applied to your trade. But knowing what they are in advance in outline form here, you can already see how you can look to see if it's going to be a probable scenario for your particular trade idea. You may not be trading anywhere near a weekly low.

You may not be trading anywhere near a monthly low. So they may not even be any consideration at all. You probably already took something off at 20 to 30 pips, and it hasn't much moved beyond that going into 5 a.m. New York time.

So you wouldn't consider that either. The scaling out ahead of 7 a.m., maybe you have taken 20 or 30 pips already in London, and then it went the whole full average daily range all during London. You're not going to take something ahead of 7 a.m. on that because you've already taken something based on average daily range being fulfilled.

Looking at the scenarios that would potentially... paying out here and also for the entries. Again, not all of them will be applicable.

So don't freak out because it seems like a whole lot. And yes, you're being challenged. I promised you in the latter lessons, you're going to have to think.

You have to think for yourself. You have to have rules. You have to look for these types of things yourself in the charts. They all won't be there.

So you're not having to look through all these things to whittle down to what you should be doing for your trade. All of the... criteria that's been listed here for the setups, the buys, the sells, where your stop loss is. There are specific rules for all of that.

I have specific outlined scenarios in this teaching that if you stick to them, you'll do everything that I do on a week-by-week basis when I'm trading. So yes, it requires you to think. Yes, it's a little bit of work, but is it worth it? Absolutely. And until next time, wish you good luck and good trading.

Transcript for:High Probability Day Trading Strategies

Transcript for:
High Probability Day Trading Strategies