Overview
This lecture covers the "continuation" trading strategy, building on previous steps (indication and correction) to identify strong trade entries using higher and lower time frames.
ICC Trading Model Overview
- ICC stands for Indication, Correction, and Continuation, a three-step entry strategy.
- Step 1: Indication means a new high or new low forms, signaling a potential trend change.
- Step 2: Correction is a counter-move after indication, often serving as a liquidity grab.
- Step 3: Continuation confirms the trend, providing the trade entry point.
Using Time Frames for Analysis
- Mark up key support and resistance levels on the 1-hour or higher time frames for strong signals.
- Use the 15-minute or 5-minute time frames to refine entries and confirm structure breaks.
- Only consider the past 3-5 days of price action for relevant high/low levels.
Trade Entry Process
- Wait for price to break structure (new high/low) for step one (indication).
- Do not enter immediately after the first break; wait for the correction and a second move in the new direction.
- Track highs and lows closely using smaller time frames for accurate trend analysis.
- Only enter trades after a confirmed continuation move, not just after the initial indication or correction.
Managing Trades and Exits
- Use higher time frame levels for stop-loss and take-profit (TP) targets.
- Consider entering trades only below/above stronger levels (e.g., 1-hour support/resistance) for safer entries.
- Monitor for structure shifts (e.g., higher support or broken lower high) to manage exits or avoid fakeouts.
Avoiding Fakeouts and Liquidity Grabs
- Avoid trading on the first break, as this is often a liquidity grab to trap breakout traders.
- Wait for price to test the level a second time for higher probability setups.
- Recognize equal highs/lows as signs of indecision; do not trade until a clear break occurs.
Key Terms & Definitions
- Indication — Formation of a new high or low, signaling trend potential.
- Correction — Counter-move after indication, often to grab liquidity.
- Continuation — The confirmed resumption of the main trend, offering the best entry.
- Liquidity Grab — Price movement that triggers stop-losses, trapping traders before reversing.
- Support/Resistance — Price levels where reversals or breakouts are likely.
- Time Frame (TF) — Chart interval used for analysis (e.g., 1-hour, 5-minute).
Action Items / Next Steps
- Practice marking indication, correction, and continuation on recent charts.
- Review previous videos (especially video 1 and video 3) for foundational concepts.
- Use 1-hour and lower time frames to identify and confirm entries.
- Track and journal your trade setups and outcomes as homework.