Targets With Standard Deviation Projections - ICT Concepts

Summary

In this video, Edward explains how to use standard deviation projections and Fibonacci tools to effectively target take profit levels after entering a trade. He demonstrates this concept using examples on various currency pairs, focusing on identifying key areas like fair value gaps and balance price ranges (BPR). The strategy emphasizes understanding manipulation moves and applying Fibonacci settings for accurate target predictions. Edward also stresses the importance of backtesting, confluences, and staying aware of liquidity zones when making trade decisions. The video aims to help viewers better navigate market structure shifts and refine their trading strategies.

Takeaways

• 😀 The video focuses on using Fibonacci retracements and standard deviation projections for targeting take-profit areas in trading.
• 😀 The ICT (Inner Circle Trader) method is used to explain how to identify liquidity sweeps and manipulate price action for more accurate trade entries.
• 😀 The concept of liquidity sweeps is critical, where price moves to take out previous highs or lows before reversing.
• 😀 Fibonacci projections help traders pinpoint key price targets after price sweeps, with specific target zones between Fibonacci levels 2.5 and 2 considered safer.
• 😀 Imbalances such as Fair Value Gaps (FVG) and Balance Price Ranges (BPR) provide confluence zones for potential trade entries and exits.
• 😀 The method recommends moving to lower time frames (e.g., 15-minute charts) to better identify market structure shifts for precise entries.
• 😀 Traders are encouraged to use Fibonacci projections from the low to the high (or vice versa) based on the manipulation move to set targets effectively.
• 😀 The video stresses the importance of backtesting the strategy to ensure its accuracy and reliability in real trading conditions.
• 😀 The strategy involves using both Fibonacci retracements and projections to find optimal entry and exit points, with an emphasis on liquidity zones.
• 😀 Always pay attention to price action on the left side of the chart (previous highs and lows), which helps in targeting and planning the next move.
• 😀 The presenter advises against blindly following Fibonacci levels and instead encourages combining them with price action analysis and liquidity sweep observations.

Q & A

What is the main concept discussed in the video?

The video focuses on using Fibonacci retracements and projections to set target zones in trading. It specifically emphasizes applying these tools to identify optimal entry points and take-profit levels, based on the ICT (Inner Circle Trader) methodology.

How does the speaker suggest using Fibonacci for target projections?

The speaker suggests using Fibonacci projections from the manipulation move (the sweep of liquidity) to identify potential price targets. The Fibonacci tool helps define key levels such as 2.5, 2, 3, and 4, which correspond to different target zones based on liquidity.

What is the significance of the 'manipulation move' in the trading strategy?

The manipulation move refers to the initial liquidity sweep, where the market takes out previous highs or lows before a shift in market structure. This move is essential for determining where to place Fibonacci levels for accurate projections.

What is a Balance Price Range (BPR), and how is it used in the video?

A Balance Price Range (BPR) is a zone where price imbalances overlap, creating a favorable area for entry. The speaker uses BPRs as key zones to enter trades, especially when they align with other indicators such as Fibonacci levels or liquidity sweeps.

How does the speaker identify a good entry point on the charts?

The speaker looks for confluences such as a market structure shift (break of a high or low), strong momentum, and the presence of a Fair Value Gap (FVG) or BPR. After these conditions are met, they use Fibonacci retracement and projection levels to find the optimal entry zone.

What is the significance of the OTE (Optimal Trade Entry) level in Fibonacci retracement?

The OTE is a key concept in Fibonacci retracement, identifying the optimal entry point after a price pullback. The speaker uses the Fibonacci retracement tool to pinpoint the OTE, which helps traders enter the market at favorable price levels for potential reversals.

Why is it important to pay attention to previous liquidity zones?

Previous liquidity zones are crucial because they help identify areas where price is likely to react. For example, when a price sweep takes out buy-side or sell-side liquidity, it indicates potential reversal points. These zones are often targeted for take-profit levels or to gauge market direction.

How does the speaker handle risk management when targeting Fibonacci levels?

The speaker suggests placing stop-loss orders below key levels, such as below recent lows, to manage risk. They also emphasize the importance of adjusting targets based on the setup, with safer targets typically being in the 2 to 2.5 Fibonacci projection range.

What does the speaker mean by 'market structure shift'?

A market structure shift occurs when the price breaks previous highs or lows, indicating a potential change in the trend. This shift signals that the market may reverse direction, which is key to identifying entry points for trades.

How does the speaker use timeframes when analyzing trades?

The speaker uses multiple timeframes to assess market conditions. They start with a higher timeframe (like H4) to spot key price levels, then switch to a lower timeframe (like 15 minutes) to pinpoint precise entry points and observe market reactions more closely.