Lecture Notes: Power of Three (AMD Cycles) and OHLC/OLHC Candles

Key Concepts

Power of Three

• Definition: Refers to Accumulation, Manipulation, and Distribution (AMD).
• Also Known As: AMD Cycles.

OHLC and OLHC

• OHLC: Open, High, Low, Close for bearish candles.
• OLHC: Open, Low, High, Close for bullish candles.
• Application: Represents how a candle opens, makes the high or low, and then closes.

Usage Across Markets

• Applicable to: Forex, indices, commodities, and all other markets.

Detailed Explanation

Sessions

• London Kill Zone: Starts at 2 AM and ends at 5 AM.
• Example: Zooming into a 5-minute candle from the London open shows open, high, low, and close.
• Marking: Open of the candle at 2 AM is critical for understanding London Kill Zone.

Candle Fractals

• Representation: Lower timeframes (e.g., 5-minute candles) during sessions like London open can show the same patterns as higher timeframes.
• FX Market Sessions Indicator: Displays candles of specific sessions.

Power of Three (Detailed)

Accumulation Phase

• Definition: Occurs at the opening range.
• Ideal Entry: During manipulation or early accumulation phase.

Manipulation Phase

• Definition: The wick on a candle, indicating false moves to trap traders.
• Example: Top wick for bearish candles, bottom wick for bullish candles.

Distribution Phase

• Definition: Opposite of manipulation, where profits are taken.
• Participants: Central banks, institutions, etc.

Practical Implementation

Using Sessions

• Example: London session takes liquidity, moves down (manipulation), accumulates, and then distributes.
• Patterns: Identical patterns can be seen in the New York session.

Applying to Higher Time Frames

• Daily Candles: Show the same OHLC patterns and power of three phases.
• Weekly and Monthly: Consistent patterns, showing manipulation, accumulation, and distribution.

Key Points

• Importance of Context: Always combine power of three with Premium and Discount Arrays (PD arrays).
• Multi-timeframe Analysis: Apply the same principles from intraday sessions to daily, weekly, and monthly time frames.

Conclusion

• Study: Focus on different sessions, days, weeks, and months to see the consistent fractals of AMD cycles.
• Practical Application: Use session opens, PD arrays, and power of three in harmony for better trading strategies.

Further Study

• Homework: Create monthly profiles and send markups for review.
• Contact: Share your findings via Twitter or Instagram for feedback.

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Thank you!