Lecture Notes: Impulse Price Swings and Market Protraction

Key Concepts

• Impulse Price Swings

  • Impulse swings are rapid price movements in one direction, followed by movements in the opposite direction.
  • Sequence: High → Low → High → Low → High → Low → High → Low.
  • Important for analyzing price action.
  • Smaller impulse swings can indicate manipulation or market-making activities.

• Market Protraction

  • Time-sensitive impulse price swings.
  • Three primary protractionary moves every 24 hours:
    1. Raid at 0 GMT
       • Minor movement away or lower at this time.
       • Viewed as initial influence in the Asian session.
    2. London Session (Post Midnight NY)
       • Market moves higher after midnight NY.
       • Designed to fake out traders, manipulating them into chasing initial moves.
    3. New York Session (After 7 AM NY)
       • Market moves higher initially, suggesting a false low.
       • Traders are manipulated into reversing positions.
       • Requires understanding of context and time-specific strategies.

Trading Strategy Insights

• Impulse and Protraction Integration

  • Impulse price swings can be measured and used to predict price movements.
  • Market enters into protractionary phases post impulse swings.
  • Look for liquidity grabs below lows or above highs.

• Session-based Strategies

  • Use session timings to predict protractionary phases.
  • Recognize fake-out moves in London and NY sessions.
  • Anticipate market direction changes post protractionary moves.

Practical Application

• Session Drills

  • Use time-of-day data to practice anticipation of protractionary phases.
  • Evaluate how impulse price swings relate to the time-sensitive protraction moves.
  • Develop skills in predicting market reactions to protractionary states.

• Market Context Understanding

  • Identify market conditions and anticipate trader behavior.
  • Use historical lows and highs to evaluate potential market moves.

These notes cover the essential teachings on impulse price swings and market protraction, providing a basis for understanding market movements and developing effective trading strategies.