Inner Circle Trader Notes

Optimal Trade Entry (OTE)

Timeframes and retracements

Focus on higher (H4+) timeframes and big money moves. Institutions move the market.

Optimal trade entry is based on buying retracements. An impulse leg moves up/down and then moves off that level in the opposite direction (a “break in microstructure”) to enter the optimal trade entry zone.

Fibonacci Levels

Start by setting up your Fib retracement levels as follows

Level                                                         Description

1100.0
0.618%$ – 62 percent
0.705%$ – OTE – 70.5 percent
0.79%$ – 79 percent
00.0 – First Profit Scaling
-0.62Target 2
-0.27Target 1
-1Symmetrical Swing


For any retracement, drawn from the local high-low or low-high, we are looking for price to enter the zone between 62 percent and 70.9 percent. 

First fill is taken at 62 percent. Allow price to extend down to 80 (just below 70.9 percent). (?)  Stop is at the initial level (100.0).  What is the point of the 70.9 level then? Do we continue to add to the position until it exceeds that level? Then stop taking trades once that level’s exceeded and wait (pray) that it will turn before reaching the stop?
Take first profits at 0.0, and take further profits at Targets 1, 2, and Symmetrical swing if price gets that far.

Finding the first level

  • Go to the monthly chart. Why switch between MT4 and Tradingview? Just to show that the pattern isn’t exclusive to MT4? Why would it be?  Look for a local high/low. Note the price, drop a horizontal line on it.
  • Algo price levels break down price increments in quarters using 0, 20, 50, 80 to the next whole number.  So for example if price broke above 1.1714 we would expect the support level to be at 1.1720 (round to the nearest). Michael mentions 1.1765 and that it would reach support at 1.1750 but why wouldn’t it just as easily be 1.1780 since 65 is equidistant to 50 and 80?  Mark this level (the “institutional level”). 
  • Drop down to a lower TF chart (M15).
  • You want to see price rally off your level and take out (exceed) a “short-term high (low)”. This is a ‘microstructure break’.  Note (mark) that level. Price will retrace again and pick up more orders before rallying again (“intermediate high (low)”). Each time a new high/low is broken mark the new level. Is this part of a procedure or just the demonstration for this example? It seems like this is a fast summary of a more complex concept (“The Market Maker Buy Model”) that includes consolidation, distribution, re-distribution, smart-money reversal, low-risk buy, accumulation/re-accumulation.  The entire segment described reminds me of a cycle, as Hurst would define it.

    Michael also points out the ‘impulse leg’ and emphasizes its significance but it’s not yet clear how this was defined and singled out.
  • A high (low) with two lower highs (lows) on either side of it makes the high (low) in the middle a ‘significant high (low)’  Concept from Larry Williams (author of W%R and awesome oscillator, good company to keep 🙂
  • A significant high (low) being broken is more convincing than the break of the short-term high.

Drawing the Fib retracement

Draw from high/low using the bodies of the candles since brokers can cheat a little on the extremes (wicks). It’s still not clear how this particular high and low were selected, except that they occurred after the ‘significant high’. Is that enough?

3 Bar Swing Pattern (from ICT Live New York Session 2017-10-10)

3 bar swing

The daily TF is the most important (“a goldmine”).

A swing high (low)  is a high (low) with two lower highs (lows) flanking it on either side.

When you have a swing high you want to look at the previous day’s lows (highs). If price broke through the prior day’s low (high) there is a good probability that it will continue the following day.

 Michael doesn’t define what he means by continuation but I’ll assume “continue” is defined as setting a new higher high or lower low the following day.

As Jake Bernstein says, always check things out for yourself. So I did and found this to be generally true. Kind of amazing that it’s not better known (or at least, discussed) among traders considering how elementary and fundamental it is.

ICT W.E.N.T series part 1

  • Forex is a good opportunity to make an exceptional living but you need to be committed
  • You should focus on the risk not the reward
  • You need to treat it like a business owner running a business
  • Go through all the material, don’t cherry-pick
  • You are being trained like good sheep to go out and lose money (“get slaughtered”). The market is a playground for the banks. When I look at the way Forex is taught on sites like Babypips I have to agree with this. Brokers want you to lose but not too quickly, so that they can ‘milk’ you. Hence the oft-quoted “only risk 1% of your account per trade” even though position sizing should be tailored to the strategy, and a fixed equity sizing system is not always the best in all situations. The herd is taught all the same things on most sites- for ex. MACD/crossovers, etc.
  • Ground rules:
    • Leave your ego at the door
    • Know thyself; spend a week analyzing your personality – it determines the type of trader you’ll be
    • Don’t underestimate the power of forming bad habits during demo trading. Trade with the amount of leverage that you’d be able to use in a live account.
    • Treat the demo account like your business equity
    • Learn to walk before you run – you don’t need hundreds of pips a month to earn a good compounded return; if you double your account in a year that’s still a phenomenal result.
    • Keep your ego in check (see #1). Don’t brag on the forums.
    • Avoid the trader’s graveyard – overtrading, overleveraging, trading without a plan, trading without a protective stop
    • It doesn’t require long hours; don’t burn out
  • Swing points – a three candle pattern with the middle candle flanked by two candles that are either lower or higher. If the middle candle is higher than its brothers, it is a ‘swing high’, if lower, then it’s a ‘swing low’.
  • You should keep in mind the range between the highest high and the lowest low of these swings. This needs a name. Maybe a ‘swing range’?
  • We can mark the high and low of the range with a horizontal line. Is this something we should be doing in every analysis?
  • “Over time you’ll adopt an eye for price swings and the ones that will be most useful to you will become obviously much more apparent as time goes on.”  Can this be stated with more specificity? For example in the form of when you see X perform Y?
  • The OHLC prices of those three candles are sensitive price points.
  • Budget your time. Make time for your family, life, etc.

ICT W.E.N.T series part 2

  • It’s not a sprint, it’s a marathon
  • If we improve stop accuracy we can reduce the pip goal and still meet total profit objectives
  • You can measure distance in pips using a rectangle
  • Use the Monthly high/lows, the daily high/lows in swing points to build levels off which you expect price to react

ICT W.E.N.T series part 3

  • Finding your way in price
    • Know your trading timeframe
    • Frame trades on at least 3 timeframes
      • For position trading – monthly – weekly – daily (trades last months or years)
      • For swing trading – daily – 4 hour – 1 hour (trades last a week or more)
      • “Short-term trades” – 4 hour – 1 hour – M15
      • Day trading & scalping – 1 hour – M15 – M5
  • Starting with the day trade/scalping timeframe gives you immediate feedback
  • The keys to multiple TF market structure
    • Manage trades on the highest or middle TF; focus should be on the highest
    • Lowest is used to enter and signal potential reversals
    • Highest probability trades are made in the direction of the highest TF
    • All trades are framed on key support & resistance levels
    • Market profiles help with market structure analysis
  • A ‘break in microstructure’ is when price breaks past a swing high or swing low.
  • During periods of consolidation support and resistance levels should be studied. These areas are more easily traded because they have discernible price levels.
  • A previous swing can be measured to project a price target for a swing in the opposite direction; identified by a break in a previous swing high/low.  Is there a difference in the terms ‘price swing’ and ‘price leg’?
  • By marking out your swing levels you build a framework that’s needed to know if you’re in a long-term or intermediate term price swing within your market structure.
  • Traders need to be comfortable with uncertainty and having a correct directional bias doesn’t guarantee profitability
  • Moving from higher TF to lower TF we calibrate likely support and resistance levels by finding historical areas of consolidation
  • Higher level charts dictate direction.

ICT W.E.N.T series part 4

  • Support and resistance is more reliable than lagging indicators
  • Horizontal support and resistance is more reliable than diagonal (trend lines)
  • You need to find consistent trade setups and trade them the same way consistently; otherwise you’re just gambling; support and resistance is crucial to this
  • There are two types of support and resistance – natural and implied.
    • Natural types mostly break down into time periods
      • 12 month
      • Quarterly
      • Monthly
      • Weekly
      • Daily
      • Session
      • Intraday fractals
      • Trendline analysis – Channels
    • Implied
      • Fib levels
      • Pivot points

COT Reports

  • COT reports – there are 3 groups reporting
    • Small speculators
    • Large speculators
    • Commercials – Users and suppliers
    • The commercials and large speculators are usually in diametrically opposite positions
    • 12 month and 4 year highs/lows are significant predictors of change
    • When commercials are extreme long, expect a low to be forming, when extreme short, expect a top. This could take months to unfold however.
    • COT Insider Tactic
      • When commercials are extreme long reduce risk on shorts and start looking for long opportunities
      • When commercials move to net short positions, there may be a downside correction, but don’t be fooled; it’s still a bull market.
      • When commercials return to net long (less extreme) look for swing or position long trades (market will still be declining, yes? We are expecting the market to decline while commercials are bullish and vice versa?)
      • Commercials return to net short, expect more short-term corrections, ok to take short-term short trades
      • Commercials return to net long, smallest majority position to date; look for buying opportunities
      • By the time commercials are at an extreme net short position the market should have risen near its top; reduce longs and start looking for shorts.
    • Having an understanding of support and resistance/market structure along with the COT chart can help you get in synch for monster position trades (1000+pips)
  • 90% of the best moves take place in a ‘turtle soup’ environment where there is a false break below an old low. Assume the reverse is true as well. Sell stops are being taken out right before price rallies. Smart money taking out dumb money? Rejections/raids on liquidity pools? ABCD extension? I’m just going to assume I”ll understand these terms once I’ve watched 12-120 more videos.
  • “Put this in your notes – when you see THIS.” What is ‘this’? The sudden drop to take out an old low? Ok, it’s already in my notes, I hope.
  • Each low-to-high range (“measured move”) will repeat?
  • When commercials rapidly change gears it might not be a contrarian indicator the way it usually is (? Did I get this right? I don’t understand the difference between the small bumps and the big bumps in the commercial chart or the explanation given for the possible difference.)
  • Smart money buys when price is dropping, and presumably vice-versa. You want to be trading in the opposite direction you want to see a profit.
  • Stop listening to the herd
  • Focus on the smart money.
  • You want to trade in the direction of the most recent 12 month commercial net position (??) I think you mean in the direction of the large speculators? We want to trade in the opposite direction to the commercials who are hedging against the actual anticipated price movement?)
  • Wait for price to form intermediate swings? (“Intermediate” is relative to trading horizon?)
  • Use the OTE pattern to enter with the large traders (here you mention you mean the speculators, not the commercials)
  • Filter longs when commercials are extreme short (12mth/4year) and vice versa.

Inner Circle Trader Recommendations

Larry Williams – Trade Stocks & Commodities with the Insiders – Secrets of the COT Report
Larry Williams – How I made $1M trading commodities last year (info on commercials and open interest)
Stephen Briese – Commitment of Traders Bible

How to Capture Explosive Forex Profits

  • The weekly high or low usually forms between Sunday’s open and Tuesday’s London open 80% of the time. If it doesn’t then before Wednesday London Open. (How would anyone know if the high/low has formed on Monday/Tuesday if the week isn’t over yet?)

    My initial check of this bold statement seems to indicate this is not quite accurate. If this were true a good strategy would simply be to trade the opposite direction of Monday-Wednesday on Thursday and Friday. Trading might be simple but it ain’t that simple! See testing results at https://docs.google.com/spreadsheets/d/1-W0zLc9-oqQ1uIuACLKnjX6DHE58KETlNxZxxmOKZ6s

Even if we sum the highs and lows for Monday, Tuesday and Wednesday from Oct ‘16-Oct-’17 their total percentage of the week is around 58%. Monday is the clear winner at 30%. The trouble is there is still a 70% chance that the high or low will be on another day. Checking 2010 next.

2010

Back in 2010 the most likely day of the week that a high or low would fall was Friday (31%) , not Monday or Tuesday or Wednesday. Combined percentage of 56% for M/T/W

None of this invalidates the notion of the ‘Judas Swing’ necessarily, but I think we can safely say the 80% figure quoted is an exaggeration, unless things are much different in other instruments, which they may be, I haven’t had time/inclination to check yet.

My preference would be to explain this phenomenon as a result of price bouncing off the sides of price channels, in other words, cyclicality, but I’m trying to keep an open mind.

USD/CAD Analysis

  • London ICT Killzone? (I presume this was explained in another video or maybe I missed it.)
  • Barcharts.com – click ‘add study’ and choose ‘commitment of traders’ (name changed since video was made)  Using 5 year period.
  • Daily chart – using 18 & 40 period EMAs.
  • Open interest – no longer on Barchart.com? Or is ‘volume’ the same as total volume? Contract volume is also missing now. What should we try using now?
  • Trading on the higher timeframes puts you in synch with the smart money.
  • The opening of the distance between the MA’s is indicative of ‘stacking’. Which basically just means price was rising? Or smart money was re-purchasing at every dip?

ICT Swing Trading Method

  • Smart money is driven by greed.
  • Larry Williams – the secret of selecting stocks for immediate and substantial gains – when the Dow was making a lower low but certain stocks didn’t make a lower low, these were the ones that smart money was accumulating.
  • SMT – Smart Money Tool – looks at correlated asset classes to decode smart money intentions  Where can we find this now?
    • Quarterly shift in flows – (not discussed?)
    • Old Highs and Lows (important levels?) – not discussed, but I suppose we get it by now
    • SMT divergence on daily – (the mirrored charts)
    • Market structure – kind of explained in other videos
    • Swing Point Analysis – not discussed?
    • OTE strategies – explained in the OTE video?
    • Swing projection for profit objectives – explained in the Swing in SMT Setup (below)?
  • Two charts are displayed, one chart is reversed (mirrored) so that we can examine divergence in prices. When we spot something that isn’t mirroring it can tell us if smart money is accumulating or distributing a currency.
    Does the indicator add the arrows? If not, this chart might be better represented as a stripe of color behind both price lines, highlighting the area where prices are diverging.
  • Every 3 months or so you’ll spot divergence. How often do you check this tool?

The Swing in SMT Setup

  • Assuming that price has shown some bearish divergence we expect price to reach a level of ‘higher timeframe resistance’. That’s a resistance level visible on the D1, W1 or MN charts.
  • Price would move away from the resistance level, showing a commitment from the smart moneyed class.
    • If you aren’t looking at the higher TF you could easily mistake these as a setup for the opposite signal (buy when it’s bearish for example).
  • You want to see a rally back up to the resistance level. When it does that you have the signal to sell.
  • You want to see the market break down past the previous swing low(s). What if it doesn’t but consolidates around the same level or a bit higher?
  • Then you’ll be looking for the A-B-C-D measured move.
  • Then there will be a retracement soon after that.
  • That retracement could go back to the previous swing low or it could ..do something else that isn’t clear. Wasn’t drawn on the chart. Some kind of double-fake? “A previous swing-high that’s run again.” Needs clarification. I think it was the thing that happened when you said ‘Write this in your notes’ in a previous video.
  • After that you get the big measured move – ABCD extensions (?) again.
  • The amplitude of that measured move compared to the previous measured move (up) is one objective.
  • “Or you can take that range and do a 127 extension” (?) “here” (most recent swing low?) “or a 1.62 extension” (I think this is the 62% level set up in the OTE video – except that one is 0.618 (0.62) not 1.62
  • “And couple that with the ABCD extension harmonically; this is the easiest way to get in synch with the commercials, using a pattern-based trade.
  • This can be applied to intraday trading as well.
  • After this price will consolidate and everyone will chase the move lower but it’s already happened and you’ve already taken the profit.

A lot of material in this video. It could probably be split up into 5 other videos, although I appreciate the information density. This last segment was maybe one of the most important and was only given a few minutes. I think you need a video (probably have one already) that goes over the process outlined in this swing trade in minute detail, step-by-step.

ICT Development Concept: Scalping Exercise

  • If you follow this exercise a few times a week your understanding of price action will improve
  • Swing high on a daily chart – start looking for the lows to be violated.
  • “Every time you see the previous day’s low it’s an opportunity for a trade.” (opportunity to go long?)
  • It’s a scalping tactic.
  • 20-30 pips every day.
  • Not necessarily in a single pair.
  • Min. objective is to reach the previous swing low. Price appears to be bearish and that swing low level was support earlier so it might be support again.
  • Chart has 7:00AM times marked with vertical lines.
  • Previous day’s lows marked with horizontal lines
  • Horizontal lines removed
  • Sunday – “whiplash and catapult” – not traded anymore – The best way to make people curious about something is to skip it. 😛 I know it’s not intended.
  • If you’re bearish look for price to rally 20 pips or more after 7am (off a previously noted level?)
  • “Anchor a previous high to the low” (I don’t know what this means-something to do with fib retracement?)
  • Previous day’s high formed between 2-4am NY time, as noted in another video. (on a Thursday.)
  • We want the retracement to get close to this high, but not exceed it.
  • We also want it to end up in the OTE trade area.
  • 20-30 pips risking 2% can double your account within a year
  • This video formed basis for Killzone strategy

Getting Started In ICT Scalping Concepts

  • Tax terms are better for Americans who trade a dollar-based pair.
  • “Price is 100% manipulated, and the daily high and daily low are already pre-determined at midnight NY time.”  At midnight last night the daily high and low has already been decided for the EURUSD.
  • Allow for some margin of error in your price targets
  • Put horizontal lines on the 50 and 00 levels of the instrument you’re tracking.
  • “Every setup you will ever need will occur around these levels” (and 20 / 80)
  • When things don’t work out the human instinct is to do the same thing but harder. This is a death sentence for traders. You need to stop. Wait for an institutional level.

ICT Pattern Recognition Drills – October 30, 2017

  • ICT Killzone is a time window where we expect the high or low of the day.
  • For London the killzone occurs typically between 2-4 AM NY time. Why then do we clearly see on the chart the red line is longer than 2 hours?
  • What is the NY killzone time window?

Integrating ICT Concepts – ECB Review

  • “These are dealing ranges” No explanation of what this term means
  • “7:00 NY Open” The NY open is now 8 AM after the time change
  • Uses head and shoulders pattern to find a neckline and project the distance from top of head to neck to form a price target. Yet, surely he has no need for this retail BS??
  • The ICT ‘order block’ is mentioned for the first time in this video, but after listening to the explanation several times I’m no further along in understanding how to spot them vs. any other period of price movement. For the one he’s pointing to there are two strong up candles near the last local peak. Institutions have rules requiring them only to buy near the bottom and sell near the top of ranges (wisely).
  • He mentions that there other things that go into identifying these blocks but he doesn’t say what they are. Instead he mentions that students assume every strong up/down candle is part of an order block (can you really blame them for being confused after such a shitty description?)And I get my first strong whiff of BS. If this is a crucial concept going forward, take the time to explain it. Or is it that you can’t really explain it, because it’s something you find wherever convenient?
  • He asks why 1.1836 is reached? Asking questions leads to gaining insights.
  • It is the level of the bullish order block, wouldn’t you know, miraculous.

Pattern Recognition – Failed OTE & FOMC Mitigation Example

  • Today’s intraday high is just a little lower than yesterday’s high. Mike sees this as ‘equal highs’ (no explanation) where retail traders will often see this as a double top. Therefore expected price direction is up, not down as someone trading a double top would expect (?) In this case the retail side was correct?
  • Usually there will be buy stops resting just above that. So these would be smart money stops expecting to prey on the retail side ignorance?
  • Better to exit before a target; don’t demand perfection.


Pattern Recognition – Selecting Precision Price Objectives

  • Take screencaps of OTE entries when you think you’ve identified them – review performance
  • Once we spot a swing low we want to target ‘runs on liquidity’ above the previous day’s high
  • Will not be teaching ‘IFTA’ Interbank price delivery algorithm – Sure. Why mention it then? Looking up IFTA I can only find mention of the International Federation of Technical Analysts. Did Mike get these mixed up?
    Looking up “Interbank price delivery algorithm” brings up zero results, and “price delivery algorithm” brings up 2 meaningless results, which means this term has never been recorded (by Google). So either it’s known by some other shorthand or Mike is making it up.
    Update: looking up “interbank algorithm” brings up this interesting result at the top of the page. This reminds me of Chris Lori’s equally confusing and ultimately meaningless webinars on interbank pricing engines.
  • Look for the swing low and expect the proceeding candle to break through the prior high (basis of the Simpleton and Three Amigos strategies) Incidentally I’m beginning to think these are the only trade types worth taking, for now – need that swing dash.
  • Not looking for power of 3 (???)
  • Fib retracement is a ‘crutch to help you find “areas of valuation”’. I can  accept it’s a crutch once you have enough experience to be able to see where the levels are/are going to be, but how do you define an ‘area of valuation’. Is that even a thing? If it is, why not explain what it is, and if it isn’t why make up a neologism?
  • Price swing and price leg are interchangeable terms! (see my note on that above)
  •  Every time price exceeds a previous high, reaching new liquidity at those new levels you should be taking profits, because the dynamic can change (for example making a lower high showing a change in direction bias) (where having a cyclic understanding of the market would be beneficial)
  •  Losses can give you insight – you’re paying a premium for valuable information; they’re indicators of a change in the internal structure; be willing to take the loss, trying to avoid them will ‘mess you up’. Agree
  •  If a new swing high forms, it could be indicative of a reversal, but if we don’t get follow through it could mean consolidation or just a pause before resuming the trend (all the bases covered then. Here’s an example of talking a lot without saying much.)
  • Fib is drawn body-to-body on the ‘most recent dynamic price action’ in the direction of expected trend. It’s where ‘the bulk of the buying’ took place. Ok, now we’re getting somewhere. I think this concept could be examined more closely. Unless it’s a gut instinct type choice?
  • One shot one kill?
  • Don’t hold to reach your egoistic objective; take profits at predetermined points.

What do ICT Tutorials teach you?

  • This one? Nothing because there was only music and a note about Power of 3 whose definition I haven’t seen/heard yet.

Pattern Recognition – Breakers & Market Structure

  • Analysis of EURUSD – Huddleston calls it ‘eurodollar’ but that’s actually something else. I wish I could tell you what. From Wikipedia: Eurodollars are time deposits denominated in U.S. dollars at banks outside the United States, and thus are not under the jurisdiction of the Federal Reserve.
  • Price recently moved above a local high. A break in market structure. Draw a trendline connecting the peaks. “The horizontal resistance price point.”
  • Anchor a fibonacci retracement on the lowest portion of the body candle of the local low up to the body open/close of the new local high.
  • “If price trades through it[1] then we’ll use the higher body candle to anchor it to” Would a price move like that not just be considered as part of the trade itself? A: I guess not because you didn’t get your retracement. Does he adjust his fibs depending on what price is doing? A: Yes, that makes sense actually. The Fib lengthens to match the length of the trend  and why am I only hearing this now. Unclear.
  • Target is the old local high.
  • Another fib is drawn on a slightly higher low than the previous one because it has ‘more dynamic price action’ with a ‘lot more energy behind it’.  Vague as Fuck.
  • Breakers – I think this is the same as a ‘break in market structure’.  At any first local swing high or low you can expect buy and sell stops to have been placed – creating liquidity pools – When price returns to take out those orders and then rallies, after it breaks market structure, that’s bullish/bearish. Basically, a failed continuation that creates a clear reversal, will tend to keep reversing.
  • In addition to the previous point – when price returns to the same region as the previous break-point, it signals a likely resumption of the trend. Basically that’s a dip. Buy the dips in a trend.
  • This seems like a flimsy basis for trading, so far.  I accept that fib levels are not a bad way to set entry/exit targets, and I accept that buying dips in a trend is a good general policy. I also appreciate the observation about 3 bar swings and follow-through. What else is there to hold on to here?  The theory about 00, 20, 50, 80 doesn’t seem to be holding up too much. The breaks in market structure are just a fancy way of saying ‘trend resumed’. It might also be worthwhile to pay attention to session times, but Huddleston hasn’t gone into the killzones concept in any detail yet. Trying to withhold judgement. Empty your cup, grasshopper.

Pattern Recognition – London Close OTE Short – Fiber

  • At the time when you place a trade (buying a dip or a rise) it won’t feel right because you see price doing the opposite of what you expect it will do.
  • Michael misses a portion of the ideal exit because he falls asleep – we’ve all been there, but, why not just set a take-profit (and tighten the stop-loss) when you’re super tired (and then go to bed)? You expect price to hit that level, if you don’t get anything higher, so be it?
  • Don’t beat yourself up if you don’t execute perfectly – at least the trade panned out as you planned and it was profitable.

Intraday Scalping Example With Multiple Entries On Bullish Order Blocks:

  • No audio for this video?
  • Significant level of 1.1725 marked on chart. I can’t see much of anything left of this that would lead me to believe this is significant. How is he so confidently bullish?
  • Entering inside an ‘ICT bullish order block’  Did we ever get a definition for ‘order block’? I guess this is bullish because price is coming up off 1.11725 which has been identified as a significant level – shouldn’t this just be 1.11720?
  • Seems like typically he would have entered around 1.1740 since that looks like OTE?
  • Places a market order (?) with a sl under the recent swing low and a tp above the highest visible swing high.
  • “ICT journal entry mentioned that if Monday’s high was taken out, long entry considered”  A blue arrow is shown pointing to this high, except that’s not Monday’s high. It’s a local peak that occurred later in the day.
  • Daily low was set at 3:15 AM NY time  ICT London Open Killzone
  • A line is drawn across the body highs of some recent candles, just above the entry but I don’t know what this is meant to represent.
  • A level (labelled ICT Bearish Order Block)  is drawn at 1.11792 for reasons not explained. It looks like he’s using the bottom of the body of an intermediate swing-high; it’s below the tp level chosen.
  • “If EURUSD trades above 1.11792 I think it will close here” (indicating a level just below the TP and he uses some rectangles to make a daily ‘bar’ outline. This is labelled ‘ Expected Projected Daily Range’.
  • A blue horizontal line is placed to show the end of day (or end of killzone)
  • It looks like an indicator is activated to show ADR high and low in amber
  • 1.11792 level is deleted (why?)
  • SL is adjusted a few pips up (why?)
  • Blue daily close time line (or is this the end of the killzone) is deleted (why?)
  • Much more stuff is added to the chart – all a mystery – two more levels (update: liquidity pool levels – how could we know?), calculated using rectangles, ‘get ready for some more luck, folks’. I dunno.  I took careful notes, so either this is a poor choice of order for showing videos, or he is taking for granted that we know this stuff already.
  • A couple more entries are made but not according to any obvious logic.
  • “Convinced yet?” Not quite. You missed your daily high prediction. You missed your TP levels. I don’t know what the rationale was for going long. I don’t know how you calculate the liquidity pool levels (except maybe they’re at the swing high levels?) You do much with no explanation and then -poof- magic! How can I know that you didn’t make six videos like this over the past few days and this one was the time you got lucky? For example what if I had been trading on the previous Friday (I know, he says just don’t) it would have been a miserable failure – putting the fib on the Thursday spike low up to the swing high – so naturally, we don’t see that video. If he wants to silence his detractors – he should have a week-long daily series on one pair – and leave nothing out.
  • Update: I reviewed the 23rd/24th of October using a simulator with bands and cycles on the chart and it’s clear price is about to move up on the 23rd and stay up through the 24th, with a reversal expected late in the day and through the 25th. Update: this reversal doesn’t happen on the 25th, but the 26th, so the cycles are steering you wrong at that point.

    So, this isn’t improving my entries/awareness much EXCEPT – he seems to be very certain that price is going to reach that 1.1792 level (seems to be the 50% retracement anchored from the spike low on the 18th to the spike high on the 19th/20th) whereas I would have taken profits after price reached 1.777 and quit once it started to decline. Notice that he cuts his video off at around 6:03 (video time) maybe because prior to that price was starting to go against him. Preparing to scrap the day’s work and wash/repeat with some other setup? However he’s rescued a couple hours later with a last minute spike up for the day. And it really is a prodigious spike – going from the edge of the 79 percent retracement all the way to the 50 percent, just grazing 1.11792. Hard to believe that’s not significant – some news, maybe? No – looks like the only significant news was in the morning. At that point my cycles say, to stay long, but Mike’s convinced that’s the end of the run, and he turns out to be right. SO…I have to reserve judgment for now.

Pattern Recognition – NYO Fiber Long Order Block & OTE:

  • A video following the previous day’s one – egg on my face so far.
  • It looks like his server day is 3 hours behind mine. His video starts around 07:45 NY time, which is 05:45 Mountain time, 12:45 GMT which is 14:45 on my trading server, and 11:45 on his server. So his server is GMT-1 and mine is GMT+2. He put his trade on at 11:30 his time, which is 14:30 my time, so right after the video started.
  • The idea is that the previous day’s high will be exceeded today. Note – my cycles are not optimistic about this but they also miss the mid-day rise. Huddleston doesn’t explain why he expects the high to be run.
  • Bearish divergence – retail’s trying to sell it short – Huddleston is trading against this. I respect this. Bullish/bearish divergence is mostly nonsense.
  • Fuck tradingview. Why is anyone asking for it???
  • I see “ICT Bullish order block, munchkins”, but I don’t get it. He is seeking ‘liquidity above 1.18’ but why does he suspect there is any after the recent selling?  Why is it bullish, necessarily? I am still looking for a definition of ‘order block’.  The highlighted section shows a swing low at 13:00 my time (10:00 his time) but I’m not sure why it’s significant.  That would be 11:00 GMT or 04:00 Eastern (NY) time – so maybe it’s significant because that’s within the killzone?
  • Another hint dropped about the ‘Interbank algorithm’! It will not be made public, boo-hoo!
  • It’s pretty clear I’m wrong and he’s right though. DAAMN. Maybe a second band would never have allowed me to go short here?
  • There will be no encore for Thursday or Friday of this (Oct. 23-27) week.
  • My cycles tell me to expect a steep drop on Thursday. Vindication?
  • Yes indeed, after a bit more pain, price drops way down to the OTE area of the day before. I suspect it will make a new low. Update: Yes it did. In fact it drops like a stone as if making up for lost time. Huddleston has been trading counter-trend, overall. How the devil did he figure the up day on the 25th??? Watching this video one more time.
  • He draws some lines around the bullish order block – ‘Precision Inc.’ My data’s a little different since I see some whiskers that pierce below his lines, but still, the point is that at the body high of the first candle of the swing low, price does not go much lower. That level is tested twice and each time goes right back up.
  • These price tests might be the ‘block’ that he refers to in his munchkin comment since he puts that up right after. However, first order was opened at 11:30 his server time. He allowed what I think is the ‘bullish order block’ to form, go up, retrace, and then go up again, before entering at 1.775. He’s looking for 1.1810 but doesn’t say why that level exactly.
  • Still confounded. No choice but to watch more videos, which I suppose, is probably the whole point. Keep me (and them) on the hook as long as possible.

Weekly Summary & Discussion – 11/10/17

  • This video begins with a slide summarizing the week Nov. 3-9
  • Theme is ‘what makes a trade too late to enter’
  • Looks like Fib is anchored on body low/high of a move that occurred during London killzone.
  • People who ask ‘where should I enter’ are missing the point. The most important thing is to know where the market is (most likely) going.
  • I knew ‘they could recapitalize the order block right here” What does this mean? Mentorship people know this apparently.
  • Enters on down-close candles, just like an institution.
  • Life happens, and as long as price is below/above the swing high/low it’s still viable.
  • Ability comes with experience.
  • Don’t rely on other people to validate your trades. Don’t become dependent on gurus.
  • This time of year the market is crystal clear. This doesn’t fill me with confidence. So this stuff only works seasonally?
  • The marketplace works ‘by allowing liquidity pools to build up where it makes sense for price to move to after a buy opportunity has happened’. Something like that.
  • These ‘concepts’ will let you find opportunities. Yes, but what concepts exactly? Could you make a list of them? Could you make a glossary? So far I can only bring to mind – swing high/low.  Killzones are most likely high/low of the day. Anchoring fibs on swings chosen by whim. Institutional levels, 0,20,50,80 and of course, the Fib setup from the first video. It’s not enough. I’m not saying you don’t know the rest but you haven’t taught the rest, maybe because it’s not mechanical, it’s instinctive.
  • Use the scalping system that I taught you this week. Please. No system has been taught. Not even whole components of a system.
  • Update 2017-11-19; tested the oct-20-27 week using a wider band and G( basically band-saw and performed well on every day. The simple rule is to trust G only when it makes sense with what happened on the last band touch. So go long when G is long and the band is bouncing from the bottom, and go short when G is short and price is coming down from the top band. This seems to explain things better than Mr. Huddleston can manage, with all of his killzone stuff. The problem is my system requires a robot who doesn’t sleep. Unless you only want to catch part of the move, which could be fine.
  • Update2 G can be grossly misled – so bandsaw is not the grail.

ICT Weekly Recap & Table Talk Session – 11/17/17

  • Mentions another ICT bearish order block. This time it’s a monthly one. Looks like a swing high with continuation.
  • My tutorials go into great lengths about how to see these kinds of things (false breaks).  No, they really don’t.
  • It was either this video or the previous one that Guru Huddleston unveiled his plan to open up his paid mentorships. Give away enough information to cause confusion, without giving enough to ensure independence. Get signups who are eager to ‘clear the cobwebs’.  Pfft. I don’t know. Maybe not. However the optics are bad.
  • He does not adjust for daylight savings time when drawing the killzones. Half an hour in and he finally says something concrete.
  • Using the killzone indicator is laziness. He wishes he hadn’t shared it.
  • If you expect price to reach up to a ‘big figure’ (no explanation but I assume he means a whole number to the hundreds place value) – in this  case 1.28, then you should also expect it to go up 10-20 pips beyond that.
  • Equal highs and equal lows ‘ are gold mines’. (x3) They get raided. Show us a picture. Do you mean double-tops/bottoms? I guess so.
  • Huddleston doesn’t trade using MT4! He gets his demo account data through ForexLTD and uses the MT4 station only for training. How does he actually trade? Will not say. Will not show a track record. After dealing with fx gurus for a while the inclination is to tar them all with the same brush.
  • It’s all the way up to the central bank level. They set the price.
  • Look for equal highs and lows first (We can now see that he means look for ‘flat’ sections where the wicks are trimmed to the same length)
  • These areas are where he intends to exit – getting out at this point or a little higher (basically trading the range)
  • Huddleston opens up a bit about his personal life and now I feel like a dick in my criticism of him. Dale Carnegie would not approve of my actions. Maybe he is just doing this to fill a hole in his heart, but then why take money? There are too many shills out there, and if he can trade he shouldn’t need it at all. If you’re actually wealthy, be a charity, Huddleston, or think of a creative way to give back if you need the fee as a filter.
  • Mentors: Larry Williams (How I made $1M in commodities last year), George Angell (S&P 500), Ken Roberts (maybe not?), Linda Raschke, Larry Connors (Street Smarts), John Murphy (Intermarket Analysis, Technical analysis of financial markets), Chris Laurie (asian range)
  • A lot of philosophy and history in this one, I can’t do justice to it all, some of it is inspiring and generally good advice, but I still feel like I don’t understand any one of his systems. I couldn’t do the scalping thing with any reliability because I don’t know what I’m supposed to be looking for, because he couldn’t explain it succinctly.

Post GbpUsd Rate Announcement Commentary

  • Anchor a fib to the most recent swing low to high. Note – it’s not from the highest high necessarily, just the most recent swing.
  • Any rally arising after a break in market structure should be ‘viewed with suspicion’.

ICT – UsdCad Market Review – Demo Example Long OTE

  • A continued swing low = a swing low continuation – a candle or set of candles that makes a higher low if it’s a swing low. Basically another chance to cherry pick an OTE entry. Unbelievable. Actually, very believable. So now, on top of actual swings, we need to also look at the continuation swings – and so now we’re placing at least 2 fibs down and trading which one? When would we not wait for a continuation swing or anchor from one?
  • Power of 3 is
    • Accumulation
    • Manipulation
    • Distribution

But no explanation of what that means or how it can be spotted.

  • Big price moves after the NY open are the result of higher TF daily actions
  • We’re looking for 20 pip gains
  • He’s watching EURUSD, GBPUSD, USDCAD and USDX (DXY) Might be helpful to watch the US dollar a little more carefully; esp. With anything that’s using it as the base/counter currency. Also to watch similar instruments (principle of commonality)
  • His bias in the trade was long because USDX was in consolidation. Although I’m not sure about the logic of this, at least it’s something I can understand.
  • His killzone anchor is clearly actually outside the killzone, technically.

ICT W.E.N.T #5

  • Some things were left out – trader’s trinity, stinger patterns. Why? Because not every tool is applicable to every trader.
  • We’ve been exposed to a lot of material. More accurately, a lot of talking, and a little bit of vague material. I could siphon through these notes and produce a half-page cheat sheet on everything that’s clear and worth knowing. Maybe I will.
  • Macro trends tend to move in the same direction for long periods
  • Risk on/ risk off explanation – risk off means the dollar rises as money ‘flies to safety/quality’. Equities go down, commodities go down, foreign currencies go down.. Risk on means the foreign currencies go up.
  • When the dollar is rallying it might not be a great time to trade foreign currencies as you’re trading against the flow.
  • On DXY we see price has recently broken above a previous resistance point
  • Price came down and bounced up off that level, so we expect a USD rally. This is a risk-off environment. We’re looking for sell scenarios for fiber and cable (EURUSD and GBPUSD are bearish in this environment)
  • On GBPUSD a level is drawn with no explanation
  • The large down move below this level  ‘correlates with the price earler in the week’ and signals the start of a pound decline (because we expect a dollar rally).
  • With the bearish bias, we expect a rally (a sucker’s play – the “Judas swing”) around the killzone time This is banksters bringing price up to a point where they can whack it.
  • A fib is drawn from the low just prior to the killzone up to the high just before yesterday’s close. I haven’t seen a fib drawn like this before in any of his videos. I can see why criticisms of cherry-picking get lobbied at Mr. H. It wouldn’t occur to me to draw a fib from those points. They do just happen to create a very tidy OTE entry for the setup that’s approaching though.
  • “Power of 3” Huddleston begins to explain this and then gets distracted and doesn’t come back to finish the definition. This is classic H and is the thesis statement of my criticisms.
  • “A really good living. It’s crazy how much money is available.” From trading or selling mentorships? No, don’t show us any proof. Forex gurus are really trustworthy so it’s not necessary.
  • The daily closing range – high/low will occur around London close – between 10-12 am NY time, unless there’s some kind of red news event
  • ‘Profit release portion” Sounds pretty fancy!
  • Looking at the bar chart (cable) daily view it’s clear that price (at least in a trend) usually does move past the open level and then resumes in the direction of the trend for the bulk of the bar height. According to Huddleston, this is the ‘Judas Swing’ in action. Admittedly this is pretty persuasive.
  • Michael Joe Huddleston promises that you will lose money but if you listen carefully you will not lose as much as you win.
  • 30 pip stop loss. 0.0025 % -¼ of one percent- risk.
  • Aug 1 2014 is used as an example but I’m more interested in Jul 31. Why not show us that one, H?
  • “Turtle soup” the false breakout. I think it was mentioned before but I don’t think I’ve seen a video about it. This is mentioned as the second of two patterns H trades.
  • H has learned the most in the last 8 years of his trading career.
  • Lazy doesn’t pay!
  • By doing what he tells us he guarantees we will be successful. Even if that’s true, I guarantee there are at least a few people too dumb to be successful.
  • “If they’re selling you that stuff they are not that good a trader.  I don’t need your money.” Then why are you wasting your time with paid mentorships. I’m sorry but this is the call of fake gurus.
  • There is a formula using the 5 day ADR (or ATR?) subtracted from the highest high (or lowest low?) to make a projected target, but I didn’t really get it. Too many fumbles.
  • ICT Average Daily Range indicator. Huddleston doesn’t recall where he got it, but I found it at this forum. The posting dates appear to be after this video was recorded though, so this might not be the origin.

ICT Cheat Sheet

Just the facts with none of the chat.

  • Look for past 3 bar swings high and low where a break of a level might act as support/resistance
  • Use fib retracements as per the chart at the top of this document.
  • Place fibs on candle bodies, not wicks
  • ICT London killzone is a period of time between 2-4 am NY time, where the high or low of the daily range will likely start.
  • The daily range will likely reach its apex/nadir around 10-12 NY time (London close).
  • Watch DXY to gauge risk-on/risk-off sentiment. Watch cable and fiber to react to this.
  • When the USD goes up, foreign currencies go down.
  • Look for a ‘Judas Swing’, a temporary retracement/dip/rally against the overall price trend to occur around the London Killzone time. It should go above the open price.
  • Use the fib anchored at any likely spots to guesstimate the OTE (optimal trade entry)
  • Take profits at scaling level, target 1, target 2.
  • For macro analysis watch COT data, and mark out likely S&R levels on MN, W1, D1
  • Look for tops/bottoms that are too ‘clean’ (neat, flat) to get taken out

Am I missing anything else that’s crucial? Add one more point for 12 lessons that can be sold in a future online offer!

Glossary

MH should reference this to help newbies, although it’s clear he doesn’t use most of these terms anymore.

https://forums.babypips.com/t/a-glossary-of-ict-terms-and-abbreviations/48377/2

My final summary
Some interesting concepts, but not very deep. I think I’d classify MH as a ‘delusional guru’. That is, someone who believes his own theories, but is fooled by randomness (Taleb) and is skilled at spinning out shallow material into hours of videos with which he uses as a springboard to attract clients to his paid mentorships.


[1] The new local high