ICT Forex - What New Traders Should Focus On

Summary

In this video, The Inner Circle Trader provides comprehensive insights into the world of Forex trading, specifically tailored for new traders. It centers on the key concepts that beginners should hone, such as liquidity pools, ICT order blocks, and high probability entries. The aim is to guide new traders from falling into the common pitfalls of retail trading thought and instead adopting an institutional trading mindset. Throughout the tutorial, a practical and structured approach is used to help traders understand the critical facets of price action analysis via minimalistic charting and disciplined trading practices to instill patience and discipline.

Highlights

• Analyzing liquidity pools and how they indicate high probability trading spots 📊
• How to spot ICT order blocks for better entry and exit strategy 📈
• Understanding price action fractals across different time frames to enhance trading versatility 🔎
• Developing trading discipline through strictly managing trades in demo accounts 🕰️
• Dispelling common retail trading myths for better institutional trading insights 🔍

Key Takeaways

• Understand the concept of liquidity raids and stop runs to identify potential trading opportunities 🚀
• Get familiar with ICT order blocks for high-accuracy entry points 🔍
• Focus on fractal nature of the market to trade any timeframe efficiently ⏰
• Cultivate patience and discipline to master Forex trading 💪
• Utilize demo accounts to practice without risks as a path to learning 📈

Overview

Starting with a captivating intro, the video dives right into the heart of Forex trading essentials aimed at transforming raw beginners into institutionally-minded traders. It's all about focusing on key Forex tenets such as liquidity raids and ICT order blocks, which are expounded via simple but effective trading strategies.

The fun, engaging narrative ensures that even complex aspects, such as price action's fractal nature and leveraging demo accounts for risk-free practice, are easy to grasp. The emphasis on staying patient and cultivating trading discipline forms a recurring theme throughout the discussion.

From detailed chart analyses to step-by-step trading exercises, the video sets out a roadmap for aspiring traders. Following a month-long study of price action sans trading, it encourages a habit of marking out double tops and bottoms to spot potential areas of liquidity, preparing the trader for the next steps in their trading journey.

Chapters

• 00:00 - 02:00: Introduction and Objectives The chapter titled 'Introduction and Objectives' appears to include elements like laughter and music, suggesting an engaging and possibly informal beginning. The exact objectives and specific content of the chapter are not provided in the transcript, which consists only of non-verbal elements, laughter and music. The summary for this chapter cannot be comprehensive due to the lack of detailed textual content related to the objectives and topics covered.
• 02:00 - 05:30: Understanding Liquidity in Forex The chapter begins with a welcoming message to the audience, indicating both new and returning learners. It mentions the start of a new journey in understanding Forex liquidity, especially for those previously acquainted with older ICT tutorials.
• 05:30 - 10:00: The Retail Trading Perspective The chapter focuses on creating user-friendly and concise tutorials aimed at new traders. The primary goal is to balance density of content with manageability of duration, making the tutorials short enough to maintain engagement without overwhelming the learners.
• 10:00 - 15:00: Identifying Institutional Trading Patterns This chapter covers the identification of institutional trading patterns using various ICT concepts. It includes the theory of liquidity raids or stop runs, an introduction to liquidity pools, and methods to locate high-probability liquidity areas.
• 15:00 - 21:00: Executing Trades and Entry Points The chapter 'Executing Trades and Entry Points' introduces several advanced trading concepts. It discusses the use of ICT order blocks for high accuracy entry points that incur low drawdowns. The chapter also covers entry tactics that favor high probability targeting, the benefits of scaling profits, and strategies for making money even when trades go wrong. Overall, the chapter aims to equip traders with techniques to enhance their trading precision and profitability.
• 21:00 - 28:00: Practical Trading Example This chapter provides an overview of the Forex market, highlighting its exciting and fast-paced nature. It discusses the various types of trading that can be done within Forex, such as day trading, scalping, position trading, and swing trading, emphasizing the numerous opportunities available in this market. The chapter sets the stage for practical trading applications by introducing these concepts to new traders.
• 28:00 - 30:00: Conclusion and Final Insights The chapter discusses the author's experiences in trading, emphasizing Forex as the best asset class today. Despite having extensive experience in other markets such as stocks, bonds, commodities, and futures, the author acknowledges initial struggles and mistakes when transitioning to Forex trading.

ICT Forex - What New Traders Should Focus On Transcription

• 00:00 - 00:30 [Laughter] [Music]
• 00:30 - 01:00 hello folks welcome back all right so we're embarking on a new journey for some of you and for those who have gone through my old vintage ICT tutorials these will probably be a little bit more
• 01:00 - 01:30 user friendly and concise I did have the aim and goal in mind to make them as short concise is dense as possible with content but still not be so long in a time window I want the durations to be a little bit more manageable so that was the goal for this this round of tutorials we're gonna be talking about what should new traders
• 01:30 - 02:00 study and practice ok so what's gonna be covered in this module ok the ICT concepts used in this one there's gonna be the theory of liquidity raids or stop runs introduction to liquidity pools how to locate high probability liquidity
• 02:00 - 02:30 pools introduction of the ICT order block high accuracy entry points low drawdown entry tactics high probability targeting the benefits of scaling profits and how to make money when you are wrong all these concepts and ideas
• 02:30 - 03:00 are going to be used in practical application but before we show you that it's important to begin with a overview okay so when we look at price action as a new trader you're going to come into the marketplace especially with Forex because it's so exciting it's fast paced it's it's a wonderful mark it's a beautiful market it gives plenty of opportunities you can be day trading it you can scalp it you can position trade it you can swing trade it it's absolutely phenomenal I love it it's a
• 03:00 - 03:30 to me it's the best asset class today however like you when I first got engaged in the study of price action for Forex I quickly found myself doing a lot of things I should have been doing and what's worse is I was an experienced trader from other asset classes stocks bonds commodities and I did trade the currency markets by way of the futures market so you would think having a decade of or more really of experience
• 03:30 - 04:00 before getting involved in the foreign exchange market that I would have had a little bit better grasp on my emotions in my excitement but that didn't happen because it's 24-hour market it moved around very liquid and it was like a it's like a candy store for me so I did a lot of things wrong and I've learned over the years and these videos are gonna help you avoid a lot of those pitfalls so we're gonna cover an element
• 04:00 - 04:30 of price action that I think is essential and if you have no previous trading experience if you've not opted your mind with the retail stuff that is promoted in the industry you're actually added advantage okay folks that have gone through trading courses and material are going to have some hardships with this not just with this teaching but all of the ones I'm going
• 04:30 - 05:00 to be teaching the constant theme is I want you to think about the market place completely opposite to what retail teaches so retail is like Elliott Wave supply and demand harmonic patterns animal patterns all these things that you put on your charts they're all distractions all you need to know is the
• 05:00 - 05:30 open high low and close okay there's four reference points that make up price and we make charts based on those four reference points now we have an element of time that's a factor that won't be talked about in this module but I will talk about it in coming lessons but I want you to think about when for instance we're looking at this chart here now this is - happens to be the day of this recordings Eurodollar okay it's a 15-minute time frame and I want you to
• 05:30 - 06:00 look at it and maybe some things jump off maybe other things aren't so apparent or obvious to you but I want to kind of change your perspective on price action and I want you to focus in on areas in price action it doesn't make a difference what time frame you look at okay because price is fractal meaning that the things that you can see on one time frame they can be seen on the lower time frame or the higher time frame as well so it's a phenomena it's it repeats
• 06:00 - 06:30 itself okay the same type of formation or setup can be seen on every time frame so when we look at price or how I teach my students to look at price I want them to first understand what makes the markets move okay without understanding that your probabilities of being successful in developing yourself in a demo trade is highly unlikely and you must forget about becoming a live fun trader if you can't do well in a demo you're not going to do well on a live account
• 06:30 - 07:00 everything that I'm teaching here should be done in the medium of a demo all of my teaching is done in a demo and that's just the best way to do it play in the sandbox it's risk free and you learn to develop good habits this way so what do you do with a demo account well before you even put on trades I think that it you should be studying price action like this okay I want you to think where every one
• 07:00 - 07:30 else's trade idea would fail them now think about that because when you read books they tell you buy here sell here your stops here try to aim for this target ok so they're geared towards getting you into a move and the stop losses are pretty generic below an old low above an old high I have started a new wave of free membership followers
• 07:30 - 08:00 online and they have shared their enthusiasm with the discovery of something so simple but it evades most traders even traders that have been trading for a long period of time if you look at periods in price action where there are equal highs and equal lows this is the easiest most obvious price point to see in charts every time you see that I want you to note that ok put
• 08:00 - 08:30 a small little trendline horizontal ok and that's the only type of trendline I like we're delineating previous points where it made equal highs or slightly higher or lower it doesn't make a difference if it's exactly or if it's off by one or two pips the general theme is if it looks close enough then it's a double top or a double bottom now retail circles will teach that these are good areas to trade off of as support resistance institutional minded traders
• 08:30 - 09:00 think entirely different they know what's sitting above there's equal highs its traders by stops and they know what's residing below the equal lows traders cell stops so the way institutional mindset is poised about looking at price action they're looking for counterparties they're looking for the opposite side of their trade so when everyone else is in the retail world looking for indicators to give them buy
• 09:00 - 09:30 and sell points institutions are actually thinking where are the orders resting right now in the easiest way I have learned to teach traders to start with and there's other ways to do this but as far as I'm gonna go in the free content this is the only one I'm going to teach and it's a very simple one in literally a five-year-old can see it in the chart so anytime you see a double bottom or a double top put a small little segment or a line above it or
• 09:30 - 10:00 below it delineating it and put a notation what it is above double tops on your chart make a small little notation that it's by stops and below equal lows cell stops and I want you to study do not demo trade do not try to pick the direction I want you to study it for one full month do nothing else pick one or two pairs literally go through and watch how many times this phenomenon takes place you can look at it on any
• 10:00 - 10:30 timeframe but I think a 15 minute time frame is ideal because you'll see a lot of scenarios to pan out now I traded two markets today at the time this recording I sold short the dollar cad and also so sold short the euro dollar okay both pairs generally do not move in the same direction but I knew there was a strong likelihood that the dollar cad would sell off aggressively and therefore any movement down in the euro dollar would be a suspect decline and it would be
• 10:30 - 11:00 reaching for sell stops so that's gonna be the context behind what you see me do later on in this video that was a recorded trade so as we're looking at price I want you to take a look at this area rate in here okay we have equal lows and price has already went above an old high and broke down and it's found an area of consolidation and this is the very consolidation that I taught you how to trade the New York set up for scalping I
• 11:00 - 11:30 want you to think about that if this is a short where could you reasonably expect to see price go well obviously we would expect it to go lower but targeting what specifically well we know there's equal lows here and I like to look at old lows and old highs and project 10 to 20 pips beyond those double bottoms and double tops so in this double bottom folks see that as support price comes down hits it here
• 11:30 - 12:00 retail minded traders are going to see this rally up as a buy I do not want you to think that I want you to think the opposite I want you to think that this whole scenario is just the market getting ready to sink and go lower and attack the sell stops that are below the market place here for those traders that have been fortunate enough to be long in all this movement Road up to this high but still did not take profits and have open positions and their protective sell
• 12:00 - 12:30 stops are gonna be trailed up below these lows so institutional minded traders they're gonna see this as liquidity the market will drop down 10 to 20 pips below equal lows and that in itself you need to be determining whether or not that's a trade that's viable for you so what's a viable trade I teach that my students as a new trader should think about 20 to 30 pips per week to start and that's a very very low
• 12:30 - 13:00 threshold objective it's easy to get probably doesn't feel that way now as a new trader but I promise you over a few lessons you'll see how very easy it is to find 20 or 30 pips over the course of a week the problem is gonna be your ability to refrain from trading once you get it in your demo account you should exercise patience and not do any more weight to the next week because this teaches two important and crucial elements to longevity and trading number one it teaches patience patience waiting
• 13:00 - 13:30 for the next set up now there's gonna be a lot of gyrations in the chart that's going to draw your attention you're going to want to do something with it there's nothing wrong with paper trading it in other words making notations and saying okay I would hypothetically do this and hypothetically do that but when you practice practice with a demo account doing one execution manage it to get 20 to 30 pips for the week and then stop don't do any more demonstrating and it also teaches discipline so you're forcing yourself to follow rules everyone else is taught in the books to
• 13:30 - 14:00 trade your edge keep doing the same thing over again while your hands hot play it hard that's this foolish we're not gambling we're looking for high probability scenarios and setups so we have to understand what that is so in in addition to and a compliment to the high probability scalping course I'm using this first video to kind of like segue into a little bit more detail I want you
• 14:00 - 14:30 to think about what makes price move prices move to levels where orders reside now orders reside above old highs and below old lows so if we see double toss and double bottoms our charts should be noted like this notice there is an absence of any kind of indicator except for now the application of a Fibonacci the Fibonacci is what I taught to use to get the optimal trade entry now what I'm going to show you here is
• 14:30 - 15:00 the classic ICT optimal trade entry sixty two to seven times treatment level get short look for an objective going lower in here you can see how price did have several opportunities to get short at the sixty two percent tradesmen level now finally expanded down hit the first skilling objective which is the old low seam here then target one is hit target
• 15:00 - 15:30 two is hit and then the symmetrical price swing okay all of these levels are in agreement with running below these equal lows so it's not the fact that the magic is done by the Fibonacci the understanding is is there's traders that have been going long here double bottom is going to have trail on their by positions ringing their cell stops up so the markets going to come back and grab those orders the market does in fact collect all the cell stops
• 15:30 - 16:00 and then look at the nice vault higher in price afterwards this big response here is post sell stop rate in other words after the cell stops have been gathered up and tripped anybody that was long now has been knocked out so if they bought here or somewhere in this run up here okay they have been taken out they can't capitalize on anything going higher but what happens if you don't
• 16:00 - 16:30 have the classic ICT optimal trade entry on your chart so you miss it what do you do well if you don't get into that Fibonacci 62 to start chasing level as that balance occurs here what are you left to do do you just let the trade go know over the years I've shared examples of me getting into a trade and for those individuals that aren't really interested in learning from me they they're quick to point and say well that's chasing price and you're gonna
• 16:30 - 17:00 see just because we're not entering at the 60 to the 700 tradesman level and we're getting in somewhere down in here that's not chasing price it's absolutely not chasing price and I'll give you a perfect example of it in this recording but I want you to think about what can we do as traders if we don't get this area up here because I first taught that this is where you should get in it the problem is over the years I've been inundated with emails stating that folks don't have the courage to get in and they want to get in but many times they
• 17:00 - 17:30 are too afraid to chase price because they heard me preach don't chase price don't chase price my definition of chasing price would be once it breaks below the low here then you are chasing price you if it's gone too far and you're too close to where the targets would be to be able to see a profit okay so what do we do well we can focus in above that low in this area right in here I'm gonna take you right into that area with a little bit more detail
• 17:30 - 18:00 so this is that section of price action we just zoomed in and I want you to look at this the up candle right in here prior to this down move this is what I refer to as a bearish ICT order block now every up close candle and every down close candle does not make a order block okay there has to be a context or a storyline behind why the price should be
• 18:00 - 18:30 doing what you anticipate it doing in this case we think that the cell stops below the marketplace are going to be rated any time we see an up close candle smart money will be in that candle selling short but how can we use that information well this very next candle if you read the annotations on the chart here price actually returns back to the bearish order block low okay now what's the low of this candle right here price is returning back to it rate the time of
• 18:30 - 19:00 this candle is closed it hits that low at that time that's a low risk entry despite trading lower initially we can wait for price to read trade back to the order block to get in if we know what we're looking for so this read trade back to the bearish order block is a low risk entry point now if the short is valid this up close candle will hold price below it until
• 19:00 - 19:30 the targets are reached on this case the sell stops that we'd be talking below the equal lows now notice also in here as long as price is still above this low this setup is staged properly to reach for the liquidity pool below there's equal lows I noted a moment ago in the recording now as long as it's a boat above this low right here the setup is still valid but now I want you to think about this formation right here this
• 19:30 - 20:00 candle already starts moving lower it went down to this point here and then started trading back up higher at that moment while you're watching price right in here that's when you time your entry notice that the candles retracing right back to the ICT bearish order blocks low that's this up close candles low that is exactly when your entries made at the market institutional traders will short
• 20:00 - 20:30 during up moves now when price returns back to these up close candles we can be shorting it as well alright so now back to our example here if we see that we can find levels that have double tops and double bottoms in the market we'll want to go through them once this occurs chances are the markets going to go the opposite direction until it reaches
• 20:30 - 21:00 another area of liquidity so the markets always gyrating back and forth back and forth seeking liquidity above the marketplace and below the market place below these equal lows there's a specific range that I look for it's 10 to 20 pips sometimes it can be as much as 30 pips but I give a working range of 10 to 20 pips so there's only two levels I'm looking for it's not a zone exactly 20 pips below that low at 118 84 it's one 1864 okay
• 21:00 - 21:30 really simple specific price levels not zones not ambiguous areas to try to figure out what's going on it's exact it's a science we know exactly what we're looking for but the problem is what if we are expecting to sell short at that bearish order block at the low when it reads back to it does this offer potential for us to take a well we have an anticipated entry price at one 1891
• 21:30 - 22:00 we have an anticipated 20 pip sell stop raid price at one 1864 so no words we're anticipating getting in at one 1891 up here which is the low of this up close candle and we already know 20 pips below these lows the lowest of the to equal lows is what I use 20s below that that gives us a range low of 1 1864 so now we have 2 price points to determine whether there's enough of a range to make profit you take to these two numbers and
• 22:00 - 22:30 you - them 91 from 64 gives us 27 pips so we have anticipated range for profitable movement of 27 pips that is enough to take the scalp now what I want you to do is I want you to watch me use everything that's used here because this is what was going on in my mind before I actually executed and why I took the trade okay folks we're gonna
• 22:30 - 23:00 be doing a short and I'm waiting for the trade right back to the bottom of this candle here set the traits to 1 1891 also short not in a hurry if it takes off without me that's fine but I'm trading the bear shoulder block in here
• 23:00 - 23:30 all right folks so I'll be looking for that price at 118 91 as soon as it hits it at market I will go short now my stop has to be above the up close candle or bearish order block but because of a spread in this demo account it forces you to be 10 pips away so I'm just gonna elect to go with one 19154 my stop okay it's about there i fingers on the
• 23:30 - 24:00 trigger I'll have to do boom okay now I'm short my stop is just below one 1915 and I'm focusing my attention right below these equal lows because I want to see a sell stop raid so I'm gonna put my delineation somewhere that would be in terms of targeting and just in case I had my limit order lower down to here okay so if it goes down to that low and
• 24:00 - 24:30 it's not a stop run I have a limit order to catch any accelerated price movement but I'm really targeting that 20 pip run so I have three Lots short I'm watching price I want to see it trade below that short term low we're flirting with and then have a range expansion below there so this recording is actually sped up for time purposes but right now we're retesting the bodies of the candles in the previous short-term low and now I'm
• 24:30 - 25:00 gonna be looking for expansion on the downside and it'll reach 10 pips and hopefully 20 pips it's about two minutes late from 8:30 New York time usually it's a big volume increase for volatility and I'm setting my order up to collapse two of the three standard Lots that I'm short on Europe and I'm watching waiting to see if price gets down to that second level or 20 pips okay it's already
• 25:00 - 25:30 showing 10 pips up the decline as soon as it hits that lower level line I'm gonna collapse two of them there you go and move my stop down to +1 now I'm in a situation where I don't really care but look at the entry points zero heat no drawl down on that entry no drawl down whatsoever it was not chasing price so I have two of the three standard Lots banked and now I'm watching price later on and I'm gonna be looking to lower to
• 25:30 - 26:00 stop-loss and I may get lucky here and see a run down to that limit order but always keeping in mind that it started to trade with the context of it being just a stop run one sell stops so I want to be mindful of how much the price shows a willingness to stall or not want to go lower and I'm watching price in here to do that so I've collected a small portion of the position also now here's the second time taking something
• 26:00 - 26:30 off so a very small portion of the original three standard Lots one that's the small little fragment of the position price does one more attempt to break lower again now it's ten o'clock so time has passed about a hour and a half is going by and at this time I'm watching price I do not want to see it reverse or start to show a sign of rejection stop has been lowered to now
• 26:30 - 27:00 I'm gonna be trying to lock in 20 pips with my stop-loss as it breaks down I will lower my stop so that way if it does knock me out now I have 20 pips locked in 25 pips is locked in now we're in an area where it could start to reverse it could fail to get down to that other limit order so I'm not gonna be able to move to stop because the spread won't permit me to do so so I have to either allow my stop to
• 27:00 - 27:30 be hit or my limit order to be taken or I can collapse the trade now I was away from the computer here at the time but had I been there I would have been collapsing right now well ultimately price comes back up and it does in fact stop me out eventually as you'll see but I profited along the way taking out small portions because you never know you never know if it's gonna go down to
• 27:30 - 28:00 your objective and if you've taken the risk on initially that risk needs to be reduced to a point of which where it's no longer impactful and there's my stop-loss being tagged and there is the fruits of that short very very predictable in terms of price action and not a bad little scout for a run on stops the context was there everything was outlined and you can see the post trade
• 28:00 - 28:30 results ultimately later on you can see as we showed in the beginning the video your dog does vault up higher after running those stops hopefully you found this insightful until next time wish you good luck and good trading you