ICT - Mastering High Probability Scalping Vol. 2 of 3

Summary

This video script discusses mastering high-probability scalping by focusing on daily bias and bank liquidity runs. It explains how to identify optimal trade entry scenarios using daily charts, swing highs, and lows, and emphasizes the importance of waiting for specific criteria to anticipate buying or selling opportunities. The speaker also shares insights on setting realistic trading goals and the potential of achieving consistent profits with a disciplined approach.

Takeaways

• 📊 The video discusses 'Mastering High-Probability Scalping' with a focus on daily bias and bank liquidity runs, using the daily chart for analysis.
• 📈 A bullish stage is identified when a swing high is broken, indicating a future buying opportunity and the need to wait for specific criteria to enter a trade.
• 📉 The criteria for a bullish trade include the formation of a swing low on the daily chart that does not take out a previous recent swing low, followed by a break of the swing high.
• 🔍 Traders should be on alert for a retracement after a swing high is broken, anticipating a buying opportunity when the market finds momentum on the upside.
• 🕊 In a bearish scenario, the strategy involves waiting for a swing low to be broken on the daily chart, setting the stage for a bearish market condition.
• 🔑 Key points for a bearish trade include not breaking a previous swing high immediately before the swing low that has broken a previous swing low.
• 🚀 The importance of waiting for the third candle in a swing high or swing low formation to be traded through on the following day is emphasized for optimal trade entry.
• 🌐 The video mentions that setups may not occur every trading day, but emphasizes the importance of patience and waiting for the market to present opportunities.
• 🎯 The presenter suggests aiming for 25 pips or so per week, which is a realistic and achievable goal for traders, especially when starting out.
• 📉 The concept of 'time and price killzone' is introduced, which involves framing the entry and exit points based on optimal trade entry levels and previous day's highs or lows.
• 📝 The script concludes by highlighting the importance of having a clear strategy and realistic expectations, focusing on consistent returns rather than large, unpredictable gains.

Q & A

What is the main focus of the video 'Mastering High Probability Scalping' volume two?

The main focus of the video is on the concept of 'previous day bank liquidity runs' and how to implement the daily bias strategy on a daily chart for high probability scalping in trading.

What is meant by 'daily bias' in the context of this video?

The 'daily bias' refers to a trading strategy where the trader waits for a swing high or swing low to form and be broken on a daily chart, signaling a potential bullish or bearish market condition respectively.

How is a swing high identified in the context of the daily bias strategy?

A swing high is identified as a candlestick pattern on the daily chart with a lower high to its left and right, and when it is broken, it signals a potential bullish stage.

What criteria should be met for a swing low to be considered in the daily bias strategy?

A swing low should have a higher low compared to the candlesticks to its left and right, and it should not take out a previous recent swing low, indicating a potential optimal trade entry scenario.

What does the video suggest to do after identifying a swing high or swing low on the daily chart?

After identifying a swing high or swing low, the video suggests waiting for a retracement and then looking for the third candle to form. The trader should anticipate the high or low of this third candle to be traded through on the very next day.

What is the significance of the third candle in the context of the daily bias strategy?

The third candle is significant as it completes the swing high or swing low pattern. The trader should anticipate the high of a bullish swing low or the low of a bearish swing high to be traded through on the next trading day.

What is the recommended approach for setting up trades based on the daily bias strategy?

The recommended approach is to wait for a setup that aligns with the daily bias, focusing on the retracement levels and the optimal trade entry price. The trader should aim for a specific number of pips per week and not force trades.

How does the video address the concern of not getting a setup every single trading day?

The video acknowledges that not every trading day will have a setup and emphasizes that it's not necessary to trade every day. It suggests focusing on major currency pairs against the dollar, which can provide about three to four solid setups per week.

What is the suggested weekly target for traders using the daily bias strategy?

The video suggests a realistic target of about 25 pips per week, which is achievable with one or two good setups. It emphasizes the importance of consistency and gradual growth rather than seeking large, unrealistic gains.

How does the video explain the importance of patience and discipline in the daily bias strategy?

The video emphasizes the need for patience by explaining that setups may not present themselves every day and the importance of discipline by sticking to the strategy's criteria without forcing trades or deviating from the plan.

What is the role of 'kill zones' in the daily bias strategy as discussed in the video?

The 'kill zones' refer to specific price levels that the trader should aim for when entering a trade. The video suggests using these zones to set realistic expectations for the potential profit from each setup.

Outlines

00:00

📊 Mastering High-Probability Scalping with Daily Bias

The video script introduces a strategy for high-probability scalping by focusing on daily bias and bank liquidity runs. It emphasizes the importance of identifying swing highs and lows on a daily chart to anticipate future buying or selling opportunities. The strategy involves waiting for a swing high to be broken to signal a bullish stage and then looking for a swing low that does not violate a recent low as an optimal entry point. The goal is to trade with the market momentum after a short-term high or low has been established, aiming for a retracement that leads to a profitable exit. The script also explains the criteria for a bullish scenario, including the formation of a new high after breaking a swing high and the anticipation of a daily swing low, with the expectation that the market will run through the high of the third candle in a swing low formation.

05:03

🐻 Bearish Market Condition and Trading Strategy

This paragraph delves into the bearish aspect of the trading strategy, detailing the process of identifying a bearish market condition by watching for a swing low to be broken on the daily chart. It discusses the importance of not breaking a previous swing high immediately before the swing low is violated. The strategy involves waiting for a retracement after a new low is established and then anticipating a violation of the low on the following trading day. The script provides a clear summary of the steps to identify a bearish scenario, including the formation of a daily swing high that does not break a recent high and the anticipation of the market trading to a new low. It also addresses common concerns about the frequency of setups and emphasizes the importance of patience and discipline in trading, highlighting the realistic goal of achieving 25 to 50 pips per week with a 2% risk per trade.

10:03

📈 Optimal Trade Entry and Market Momentum

The script continues with an explanation of how to identify optimal trade entries based on market momentum, focusing on the importance of syncing with the market's natural rhythm. It suggests that Tuesdays and Wednesdays are typically the best days for trading, as they often set the tone for the week's price action. The speaker shares a personal approach to trading, preferring to achieve the weekly objective within a few days to avoid unnecessary risk. The paragraph illustrates the concept with a practical example from a daily chart, showing how to identify a swing low and high and how to anticipate market movements based on these formations. It also introduces the concept of 'kill zones' and how to use them in conjunction with optimal trade entry levels to maximize trading opportunities.

15:03

🎯 Targeting Profitable Scalping Opportunities

The final paragraph discusses the practical application of the scalping strategy, focusing on the importance of setting realistic profit targets and understanding market probabilities. It emphasizes the significance of identifying key price levels, such as previous day's highs, and using them as targets for trades. The speaker shares personal insights on how to approach trading with a conservative mindset, aiming for consistent profits rather than chasing large, uncertain gains. The paragraph also touches on the psychological aspect of trading, encouraging traders to develop an expectancy for consistent returns and to frame their trading career around achievable weekly profit goals. It concludes by reiterating the importance of focusing on 20-25 pips per setup and the feasibility of achieving a 50 pip net return per week as a developing trader.

Keywords

💡Scalping

Scalping is a trading strategy where traders aim to make small profits on a regular basis, typically within a single trading day. In the context of this video, scalping is the main focus, and the speaker discusses strategies for high-probability scalping, emphasizing the importance of identifying optimal trade entries and exits based on market patterns and price movements.

💡Daily Bias

Daily bias refers to the overall trend or direction that the market is expected to follow on a daily basis, as indicated by the price action on a daily chart. The video discusses how to implement the daily bias by waiting for a swing high or low to form and then watching for specific criteria to anticipate future buying or selling opportunities.

💡Swing High

A swing high is a price level that is higher than the prices immediately before and after it, indicating a potential resistance level. In the video, the speaker explains that a bullish stage is triggered when a swing high is broken, meaning the price moves above this level, signaling a potential buying opportunity.

💡Swing Low

A swing low is a price level that is lower than the prices immediately before and after it, indicating a potential support level. The video discusses how to identify a swing low and how it can signal a potential bearish market condition, leading to a sell scenario.

💡Retracement

Retracement is a temporary reversal in the market following a strong price movement. In the video, the speaker talks about waiting for a retracement after a swing high or low is broken, as this can provide a good entry point for a trade in the direction of the original trend.

💡Trade Entry

Trade entry refers to the specific price level at which a trader decides to enter a trade. The video emphasizes the importance of identifying optimal trade entry points, such as after a swing high or low has been broken, to increase the probability of a successful trade.

💡Liquidity Runs

Liquidity runs refer to periods of high trading activity, often driven by significant market events or news. The video discusses how to capitalize on liquidity runs by identifying key price levels and anticipating price movements based on market liquidity.

💡Support and Resistance Levels

Support and resistance levels are price points at which the price of an asset tends to stop falling (support) or rising (resistance). In the video, the speaker explains how to use these levels to anticipate potential price reversals and trade entry points.

💡Pips

Pips are the smallest price movement in the forex market, typically equivalent to 1/100th of 1%. The video discusses the goal of making 25 pips or more per week as a realistic and achievable target for traders using the strategies discussed.

💡Market Structure

Market structure refers to the underlying pattern or framework of the market, often determined by trends, support and resistance levels, and other technical indicators. The video explains how understanding market structure can help traders identify high-probability trade setups.

💡Optimal Trade Entry

Optimal trade entry is the ideal point at which to enter a trade based on technical analysis and market conditions. The video discusses how to identify optimal trade entries, such as after a swing high or low is broken, to increase the chances of a profitable trade.

Highlights

Introduction to volume two of a three-part series on mastering high-probability scalping strategies.

Focus on previous day bank liquidity runs and daily bias in trading.

Explanation of identifying a bullish stage by breaking a swing high on a daily chart.

Criteria for a bullish scenario including a retracement and a daily swing low formation.

Importance of not breaking a recent swing low after a swing high is broken.

Anticipating the third candle's high to be traded through the next day in a bullish setup.

Daily swing low criteria and its relation to a potential optimal trade entry scenario.

Setting up for a bearish market condition by breaking a swing low on a daily chart.

Waiting for a retracement and a violation of the swing low in a bearish scenario.

Emphasis on not breaking a previous swing high before a swing low is broken for a bearish setup.

The concept of 'kill zones' in identifying optimal trade entry and exit points.

Dealing with the reality of not having a setup every single trading day.

Statistical approach to finding setups with three to four solid opportunities per week.

Risk management strategy involving 2% of account risk for potential weekly gains.

Objective of doubling the account or making 6% compounded monthly with realistic pip targets.

Preference for trading on Tuesdays and Wednesdays for achieving weekly objectives.

Example of a scalping trade using the daily chart and 15-minute time frame.

Using session highs and lows to frame price action and identify trade setups.

Concept of aiming for 25 pips per setup and the rationale behind it.

The idea of setting realistic expectations for weekly gains and the benefits of consistency.

Final thoughts on focusing on a few good setups per week for a sustainable trading approach.

Transcripts

okay folks welcome back this is volume

two of three for mastering high

probability scalping we're focusing on

previous day bank liquidity runs alright

so we'll be reviewing the daily bias so

we everyone knows exactly what should be

done and I'm referring to a daily chart

here so when we're implementing the

daily bias what we're gonna be doing is

on a daily chart we're gonna be waiting

for a swing high to form and to be

broken this will be bullish okay when we

see a swing high broken in other words a

candle that has a lower high to the left

of it and then lower high to the right

of it as seen here okay if at any time

in the future its traded through when we

have that we have a bullish stage in

other words we anticipate a future

buying opportunity doesn't mean to buy

it right there just means we are now on

an alert to wait for a specific criteria

criteria is going to be looking for a

swing low to form down here okay a swing

low again is a candle that has a higher

load to the left of it and a higher load

to the right of it again on the daily

chart key point here is this swing low

should not take out a previous recent

swing low okay so if we have this

criteria immediately after a heist

broken we have the probable optimal

trade entry scenario by itself on a

daily chart okay doesn't mean it has to

line up with a 62 - sometimes at Racing

level it just means that we are in

effect trading with a higher

after breaking a short-term high so we

have a break-in market structure a

retracement so therefore the market

should have an ability to find momentum

on the upside okay when the swing low

forms we're going to be anticipating the

third candle that is this one here it's

high to be rated or traded through the

very next day so in other words the next

trading day where it opens preferably

you want to see it open below the third

candle the swing lows high

okay so here's your criterion you want

to see the swing low form without

breaking a previous swing low

immediately after a swing high is formed

but breaking a previous swing high ok so

again the stage for a bullish scenario

is anytime I swing high is broken and

traded to a new high expect a

retracement wait for a daily swing low

to form swing low should be a higher

swing load in any recent previous

short-term swing low the third candle

that makes the swing low that high you

want to see the next candle open below

that candle is high and then anticipate

the market to run through this candle is

high we're looking for previous day's

highs to be rated each day until a swing

high when a daily forms or price reaches

a key support or resistance level and

I'll give you an example what that would

be well the immediate candle after this

particular day's formation may be

looking for a bullish scenario okay

either in London or the New York

scenario to a raid on the previous day's

high the very next trading day we would

look for the same scenario again looking

for reasons to be bullish on a

retracement lower going higher reaching

for ultimately to this old high this

would be an area of resistance okay

or if it trades to that high and through

it we'd still maintain looking for

bullish scenarios buying looking for

previous day's highs to be taken out or

if we have price rally up to a degree

either at this level or before it in

creating a swing high once that forms we

have to wait for that swing high to be

broke on the upside okay there's going

to be a lot of missed opportunities

admittedly with this but it gives you a

specific criteria on the work within ok

employing the daily bias this is when

it's bearish and we waiting again on the

daily chart for a swing low on a daily

to be broken so we have a swing low here

again a daily candle that has a higher

low to the left of it and a higher low

to the right of it eventually as price

trades through this this break in market

structure it sets the stage for a

bearish market condition okay so we're

kind of like alerted to waiting for a

sell scenario we wait for a retracement

when we get the daily swing high formed

the third can look at it makes a swing

high we're going to anticipating that

low to be violated the very next trading

day key point is we don't want to see

this swing high break a previous swing

high immediately before the swing low

that has broken a previous swing low

okay so what we're doing is we're

looking for a swing low broken here so

now we have the ability to see the

market trade to a new a new low then it

retraces but will not break a swing high

so now we're getting net three quarter

back retracement okay so by itself it's

like an optimal trade entry doesn't have

to be 260 to 270 I'm searching some

level it's better if it does but it

doesn't require it you want to see the

market trade up until it creates a daily

swing high when that third candle forms

at its close very next trading day

you'll be watching for price to make an

attempt to trade through this candles

low and that remains the bias each

trading day until I swing low forms or

we trade down to this old low okay or

another signifigant low so again

summary its we're looking for a swing

low to form on the daily chart and then

it be broken then we're looking for a

swing high to form but does not break a

recent swing high so here's a swing high

that doesn't come back the clear or

break a previous swing high when to

swing high forms we anticipate the third

daily candle in the swing high right

here we look for its load to be rated or

traded through the following day and we

look for the previous day's low to be

rated each day until a new swing low on

a daily forms or price reaches a key

support resistance level now you're not

going to have a set up every single

trading day okay I've gotten a lot of

emails so far since I've produced a

first volume of this three-part series

and the common complaint I'm getting is

I'm not getting a setup every day and

it's not been promised okay if you look

at every major that's paired against the

dollar you can get about three to four

solid setups per week now that means

that you're probably not going to get us

up every single trading day chances are

one pair among all the ones that are

available will provide you a set up to

study so you can practice in your demo

account with it the emphasis is for you

to remember that you'd only need about

25 pips or so per week and if you risk

2% of your account and it may be high

admittedly for some of you but if you

have grown in your understanding about

what I'm teaching and you're willing to

risk 2% it takes a little bit less than

25 pips per week to double your

or make 6% compounded monthly and I

think that's the objective that folks

should be looking for when you're new

because it's realistic it's low but yet

it still doubles the account over the

course of a twelvemonth year so if we're

looking for one good set up that would

yield that 25 pips or so you only need

one scalp one set up that does that now

I started the current teaching week on

Twitter kind of building the idea of

making 50 pips per week if you frame

your scalps in such a way that it allows

you to aim for 25 pips you only really

need to set up for a week don't you now

I like that model personally because

it's very close to what I do as a

short-term or intraday trader I know the

likelihood is I want to be trading on

Tuesdays and Wednesdays if I can get my

entire weekly objective which is 50 to

75 pips per week if I can get that done

in one day then I won't do any more

trading after that regardless of what

day of the week it is but usually I hone

in on Tuesday and Wednesday because

they're primarily the best days whether

bullish or bearish if it's bullish for

the week then I'm looking for the weekly

low to form around Tuesday or Wednesday

is New York open if I can anticipate a

lower close or weekly bearish candle I'm

shooting with an expectation that we're

gonna be seeing lower prices by Friday's

close relative to Sunday's opening then

I'll be looking for Tuesday or Wednesday

--zz price action to create the high of

the week so if I can train and sync with

that idea

it also formulates a lot more conviction

and confidence behind the setups that

I'm looking to trade especially with

what's being described here it's a

rather simplistic approach it may have

been an oversimplification on my part by

way of creating this diagram but from an

internal standpoint how I view the

market place this is what I'm looking

for

so if I see them daily chart chances are

the daily chart will probably sustain

the move for a few days and you'll only

need one trading day okay so if you

having a scenario that's bullish or

bearish relative to what I just

described here so far in this video

chances are you you're probably gonna

have one day's worth of momentum and

that's all you need so every single pair

does not move lockstep to one another

they're not always moving in tandem so

what may be a good parent trade today

may not be a pair that's really good to

trade tomorrow but another pair may move

in equal or better fashion in other

words the setups are plenty but you have

to allow them to be presented in price

action from the daily chart and then not

forcing it let's take a look over at the

charts I'll give you an example of what

it looks like and we can use the kill

zones okay we're looking at the table

this is a daily chart this stroll

through just family random place it

doesn't make a difference where we start

out but I want you to take a look at the

price action here and we're going to

look at this swing low right here and

it's on the heels of a previous

short-term high okay so we have a

short-term high here lower high to the

left lower high to the right highest

high in the middle it breaks that okay

so now we're on a buy watch for scalping

this is a swing high that's broken and

we have to wait for a swing low to form

after this is broken so we're gonna be

anticipating a retracement after this

run-up says price starts to drop down

we have a preliminary swing low here

okay so this candle is the third one we

need to make sure we wait for price to

trade through this candle is high the

very next day it doesn't do that okay

now we have another candle form a

potential swing low here so this candle

here we have to wait for this candle is

high to be traded through very next

candle it doesn't do it it does it here

so now we can be a buyer here with a

Scout running previous day's high which

is this one okay so one July 24th 2017

that high again coming in at 130 57

that's where the liquidity run is going

to be right there this candle on the

25th of July is where we'll be looking

for the set up right there okay and

we're going to drop down into a smaller

time frame we use a 15-minute time frame

okay and I'll scrunch this up the day

dividers in you guys can see it so

previous day's high is right here so

I'll put a horizontal line on the chart

to facilitate that okay so here's where

the liquidity is we're running for 30 57

okay this day here we're looking for a

scenario to get long to run that liquidy

pool okay and we have this again it's

the liquidly poor wrist we're reaching

for previous day's high on this trading

day when I use the market

sessions I'm looking for London setups

and newer setups primarily this is a

London session low and I'll let you see

that here that's in London and we're

gonna use that as I mentioned in the

volume one I use session highs and lows

and this is the highest portion of the

day in terms of a 15 minute candle you

just put it right here you guys can see

it so I'm using this one and this one

framing the entire price moon so as

price starts this day here I'm not

concerned about anything until it gets

down into the optimal trade entry 62%

tracing level respectively 70.5 and 79%

okay you can see it price trades it hits

it here this candle comes in exactly

9:45 that's London and we're going into

a nice run into previous day's high okay

so you can see that was a nice little

scalp it offered as much as 10 20 30 40

pips to get to the high and if we look

for 10 to 20 pips of a sweep above this

high it takes us 10 20 here so 20 pips

40 pips 60 pips 70 pips or so in terms

of potential price range that in itself

is it for the week for me that would be

it why wouldn't you do anything else and

it's hard to believe but that's how I

operate

I don't look for a whole lot of setups

per week cuz I'm content with you know

doing one thing well and there it is now

if this were a more conservative

approach you could be looking for the

long down here based on the alcohol

trade entry and reaching just to the old

high now if that's the case say you're

filled at well just rounded to one

thirty twenty that again is getting out

at 57

it's 37 pips or so okay almost 40 pips

with us say 40 pips you only need to do

one more trade for the week for 10 pips

to get a 50 pip net return for the week

now there's a lot of folks that will say

don't set targets don't set goals for

daily or weekly because you don't know

what the markets going to do well I

would submit that that's partially true

we don't know with any assurity what the

markets going to do but we do have

pretty strong probabilities of wherever

the market may reach for and if we can

frame the idea of where we're trying to

get in at based on time and price

killzone and such a optimal trade entry

price and where we're reaching for it

doesn't that not offer us a definitive

way of determining what could be

reasonably expected for that particular

setup and if we know that we're looking

at intraday setup like this there's

typically five days per week unless it's

a holiday or the markets are not trading

because of some other bank holiday or

whatever we don't want to trade it we

can see many instances where 25 to 50

pips is rather easy to get now it's when

we get into the I want to make 250 to

500 pips per week then it becomes a

little daunting in terms of a task so I

think by focusing on 20-25 pips per

setup in an aiming for two good ones per

week I think 50 pips is a really low

hanging fruit reachable achievable and

certainly realistic in the scope of a

developing trader will you get it every

week no will you get it right out the

gate starting using my concepts no but

over time you will eventually grow into

that in an expectancy for a nice return

of 50 pips per week you can frame your

entire career on that