ICT Mentorship Core Content - Month 1 - How Market Makers Condition The Market
Summary
TLDRThe speaker discusses how new traders are unaware of market dynamics dominated by 'smart money' - large institutional players and banks that quietly control price movement. Retail traders falsely believe their collective actions drive market trends, when in reality a small group of insiders dictate expansions, retracements, reversals and consolidations using an AI price delivery algorithm attuned to human behavior. The speaker urges not sharing this paradigm-shifting perspective, as it challenges the facade that markets operate on supply/demand. By tracking smart money maneuvers over time, retail traders can better predict price action based on understanding the deliberate, methodical stages through which markets cycle.
Takeaways
- 😀 The market has two main groups - the uninformed retail traders and the smart money institutions that actually drive price.
- 👥 Retail traders mistakenly think they drive the market with supply/demand, but it's actually the banks and institutions.
- 💼 Institutions quietly trade and profit while retail traders try to get attention on social media.
- 📈 There is a clear market structure and algorithm institutions use to manipulate price that retail doesn't see.
- 🤯 Understanding how institutions manipulate price is key to trading success instead of using indicators.
- ⏰ The daily range has clear manipulation events tied to London/NY session opens you can track.
- ➡️ Price delivery follows expansion->retracement/reversal not random consolidation and reversals.
- 📊 All timeframes have the same structure - consolidate, expand/impulse, retrace/reverse, repeat.
- 🤝 Keep this institutional knowledge private to preserve its edge rather than marketing it to everyone.
- 🎓 Studying intraday gives feedback to apply concepts long-term without needing years of data.
Q & A
What is the market efficiency paradigm depicting?
-The market efficiency paradigm is depicting how new traders are collectively part of the larger uninformed money group, while there is a smaller smart money group of traders that actually influences and drives market prices.
Why do new traders tend to think they drive market prices?
-New traders tend to think their sheer numbers and buying/selling interest pushes prices up and down based on supply/demand. This is a facade perpetuated in books, seminars, etc.
Who is actually driving market prices?
-Banks and other institutional traders make up the 'smart money' group that actually drives market prices, not the larger retail trader group.
What is the daily range market structure?
-The market starts with Asian range consolidation, then a manipulation/expansion, a London reversal, another expansion, New York consolidation, a retracement, more expansion/reversals, and ends with consolidation.
What is the market delivery algorithm sequence?
-It starts with consolidation, then expansion, then either retracement or reversal, never consolidation to retracement or reversal directly.
How can you apply the concepts to longer timeframes?
-The same sequences happen on daily, weekly, monthly timeframes - starting with consolidation, expansion, retrace/reverse. Intraday shows this best.
Why is order flow and structure context important?
-To properly apply the expansion/retracement/reversal concepts, you need institutional order flow context - where are the blocks, stops, liquidity.
Why shouldn't this knowledge be shared publicly?
-Sharing detailed institutional order flow and manipulation tactics publicly could undermine the edge and allow banks/firms to adapt their behavior.
What mindsets are most important for traders?
-Patience, suppressing fear/greed emotions, and having no ego desires to make money quickly - consistency over profits.
How much detail is provided on tracking smart money?
-Very specific tracking tactics will be taught to locate blocks, stops, and predict exact turning points based on the order flow concepts.
Outlines
😊 Introducing market efficiency paradigm
The speaker introduces the market efficiency paradigm diagram representing uninformed retail traders versus informed smart money traders. He explains how retail traders wrongly believe their trading drives market prices, when actually it is the small group of smart money traders that truly moves markets.
😲 Retail traders are actually not driving markets
The speaker further elaborates that the idea of retail traders with their vast numbers moving the markets is actually just a facade. The real driver behind markets is the small circle of institutional traders and banks, like an engine driving the whole system.
🤓 Four key stages of market price delivery
The speaker outlines the four key stages of price delivery and movement: consolidation, expansion, retracement, and reversal. He explains these four concepts in relation to market open/close times and typical daily price patterns.
😃 Simplified daily range structure model
A simplified model is presented for the structure of the daily price range: starts in equilibrium/consolidation, then expansion off a news event, followed by potential retracement and/or reversal at different times of day.
☝️ Key takeaways about market price delivery
The speaker reiterates that price moves through the four stages of consolidation, expansion, retracement, and reversal in a specific order. Understanding this algorithm along with higher timeframe context allows anticipating impending price movements.
🤐 Keep this powerful knowledge discreet
In closing, the speaker urges viewers to keep the insights shared in the video private and not publicly share or market them, as they represent very valuable trading knowledge.
Mindmap
Keywords
💡market efficiency
💡smart money
💡order flow
💡liquidity provider
💡manipulation
💡stops
💡facade
💡algorithm
💡expansion
💡paradigm shift
Highlights
As new traders, we are collectively part of the larger uninformed money group
There is a small group of smart money traders that influence the entire market mechanism
Retail traders think their sheer size makes them the market driver, but that's a facade
Banks and institutions drive price movement, not retail traders
You need a paradigm shift to understand how markets are efficiently controlled by smart money
Learn to track smart money moves to become part of that influential group
Understand expansion, retracement, reversal and consolidation in context of order flow
There is a systematic price delivery algorithm you can learn to anticipate
Consolidation always precedes expansion in directional price moves
Expansion moves retrace to order blocks or reverse into consolidation
You can apply this algorithm model to any timeframe - daily, weekly etc.
With directional context, you'll easily know each day's most likely price action
Suppress desire for money; develop patience and ability to anticipate moves
Don't market this knowledge; keep it quiet to maintain advantage
Refer back as we cover more details; this builds your understanding
Transcripts
okay folks
we are in the second teaching of the
series of eight for the month of
september 2016.
and you've seen this before
but i just want to bring this up to you
one more time
this is the market efficiency paradigm
and what this generally
is depicting or what i was trying to
communicate by drawing it out is
we as new traders
are collectively part of this larger
hole over here
of uninformed money
and whether we acknowledge it or whether
we believe it or what
we will invariably come in contact with
the understanding that there is a smart
money group of traders out there
and when i first got involved in trading
i didn't know anything about smart money
i just knew that the markets were
potentially there and i could be
profitable and in fact i was going to be
profitable i knew it i couldn't believe
that i ever lose money until i lost it
so
when we
as traders look at the marketplace as
new investors new traders new
speculators
we may or may not have the understanding
that there is a smart money entity out
there
and
we as
the
larger populace of retail-minded trading
we think because of our sheer vastness
okay we are the driver okay of this
apparatus that's called the marketplace
and we tend to think of ourselves as the
drive axle of what makes the markets go
up and down which is the face that's the
facade of supply and demand that's the
facade of
trend lines driving price when it
touches it that's the facade of moving
average crossovers causing prices go up
or down that's the facade that's
perpetuated and we are led to believe
that that's exactly what takes place
either in books or in seminars or in
webinars or gurus people
and i've done this when i was younger
too i i was convinced that indicators
drew price up and down and i i
packed houses on america online when i
got on a chat room and people were in
there flocking to here the things that i
would discuss about stochastic and rsi
and williamsperson r
and i was talking about three momentum
indicators when if you're just going to
follow momentum just follow one
so if anyone
knows more about being in this group
over here trust me it's me i've been
i've been in this group enough to know
that
i learned more about this group over
here that doesn't like to draw too much
attention to itself
but contrast that with
everybody in the retail we all have
twitter accounts we all have my effects
books that we're sharing we're all
trying to be on instagram showing
lamborghinis and
whatever else
houses cars boats yachts
girlfriends they ain't even yours
everybody is living large over here in
the uninformed money
and smart money is up here quietly just
doing their thing
who's inside this small circle over here
the banks
who's in here everybody on social media
everybody in a retail account
at all the gurus and teachers out there
that have things that they're selling
services and
yes i have a new service but
what i'm teaching you
ain't available anywhere else
see this group this large populace of
people
they think
and i was part of this group initially
they think that the sheer vastness of
the size of them
is much more controlling in terms of
where price is going to be driven higher
or lower because of the buying and
selling pressure that's equated to their
mere involvement
in price
and that's a
facade this huge populace of trading
people
or traders community in the retail realm
is really not that big
but we are led to believe that we are
huge
and we are given this
this idea of ourselves that we're giants
we push price around and we don't
we don't
in fact it's this small little group of
traders
okay they're the ones that influence
this entire mechanism that we call
the markets
this small little group of traders is
actually the drive shaft
and if this was a belt like on a car
okay
like an alternator
this
is the actual motor spinning the whole
price higher lower it's not this big
circle of people
so it has to be a paradigm shift
see if you're over here thinking that
it's the group of traders that
is online talking among stem cells
as a whole
they are the ones that make price go up
and down because of their buying and
selling interest because the supply and
demand factors around them that's what
pushes price around
that's a facade
and i'm here to tell you that you need
to put that to bed now because i'm going
to level everything you've ever imagined
about the marketplace and how it really
works
you have no idea where we're going and
you need to leave this realm in this
circle of people and their thought
processes and transition
and have a paradigm shift in your
thought process about how the markets
are efficient because they're not
efficient for the speculators
they're efficient for the smart money
the banks drive price
whether you want to accept it or not
that's what's going on
and the sooner you get to that
understanding and expectation of what it
is that's going on in price
it's not for your well-being it's for
the bank's well-being
it's their
business
they have a liquidity provider
everyone else is
liquidity
are you a lamb
or a lion
which one
because
one of us is going to eat meat and the
other one's going to stand there looking
stupid eating grass
i don't want to be a part of this herd
i didn't want to be a part of it once i
understood where i was i wanted to get
out of there and i'm going to live over
here in a small little area
and for years i quietly made money doing
nothing but focusing on the things i
knew that this small group of entity of
traders did
and i looked at these individuals
initially with disdain
thinking i'm gonna come after you i'm
gonna i'm gonna devour you i'm gonna do
the same thing and then as i looked at
it more and more and heard stories about
people
and their lives losing their homes
marriages
it tugboat me and i didn't want to just
be over here
being like the banks
and then i bridged over into what you
saw me do in 2010
and i revealed a lot of things
in this mentorship you're going to learn
a whole lot
but it's not meant for you to share it
on your youtube channel it's not meant
for you to share it on your blog it's
not meant for you to pass it around on
make torrents
it's not supposed to be there
it's only supposed to be
between you and i
you're welcome to share this with your
this information with your children and
your family members
start a legacy
but don't make this common knowledge
it's gonna happen some goobers gonna
take this stuff and
be the one that you know i'm the cool
guy i'm the one that
got in there and made it all
accessible to everyone else and she
could feel the hit like the hero
that you're not really doing yourself a
favor
let this stuff stay
well hidden
you're paying for it
appreciate it for what it is
and don't share it
it's not going mainstream
you're this is the group that we have
whoever can make it in between october
1st and now that's it
that's it because when we leave
september in october we're buttoning up
all of the free tutorial stuff and we're
going right into
the nuts and bolts of where we got to go
to to get to the latter months
see when we come into the marketplace
we don't understand this we think that
this group that we're part of we are the
the the market we are the market we're
the traders we push price up and down
but
if you're honest with yourself if you've
traded at any time and you look back on
your trading you probably looked at the
market you saw something like this
you knew
something was going on and you just you
just couldn't put it together you you
see
these vague things that take place in
the marketplace your stop gets run it
looked exactly like it was going to go
up but it came all the way down knocked
you out and then went up
you see these things happening to you
you just can't figure it out you know
there's something to it
you you've had the sensation that you
know yes this is rigged my brokers have
to get me it's not really your broker
it's the interbank feed that drives
price against the funds
and the brokers are going to expand the
spread as well on you and knock you out
when you look at the price action as a
new trader
and you didn't have this exposure to
understanding how the markets are being
driven and manipulated to the degree of
every single
minute detail
they're absolutely controlled it's an ai
it's artificially intelligence it's you
are not trading against a person anymore
it's a computer program that delivers
price and it knows human behavior
because it's the same way it's been
always
fear and greed
so when you look at price and you've
been trading for a while and you had
this
fuzzy picture about something going on
behind the scenes but never really
understanding what it was
until you met me
and suddenly there's clarity
suddenly you understand that there's
something that's been there all
along now you can identify it and what's
more important is you understand how to
track it
and do the same thing it does
and by default you become
a resident of that small circle because
this small circle is the drive shaft it
which makes the markets go around
it's not the big populous of traders
it's the liquidity provider
so you need to be thinking like this
small group is over here they're not
trying to draw attention to themselves
they're not trying to be online flashing
this and flashing that they're just
quietly in here skinning people alive
and you've been there before and just
just as well as i have you either stay
in this business long enough to lead
this group and come over here
or sit back in the middle here you get
real close to being there and you get
bounced back to this group get real
close to uh you know getting over here
and you start developing a little bit
more and you play tug of war
some of you in my group right now in
this mentorship you're in this little
area right here where you can see
there's some signals and signs of a real
entity of smart money in play
but you're not fully convinced to leave
this group yet you have too many
convictions about
your tools
your indicators
your your pet guru your buddy that has a
website that's so cool to you
it's it's not enough you got to be able
to release all that stuff and just leave
it all behind and join the smart money
because trust me
we're not serving cookies but it's a way
better lifestyle over here than it is
over there
now the first video i gave you elements
to a trade setup and i gave you
two characteristics to it there's
context and framework around the trade
and then obviously those refer back to
institutional order flow
so you have to be able to bridge the two
understanding expansion retracement
reversal and consolidation and applying
them to respectively order blocks fair
value gaps liquidity voids liquidity
pools stops online i'm sorry stop
runs and equilibrium
what does that mean for us
for instance in its scope of price how
can we use these ideas and make them
applicable to price
now i know some of you are chomping at
the bit to learn long-term trading
because you can't do day trading but
bear with us as we go through these
first couple months because i want to
give you immediate feedback and the way
you get that is by using intraday study
because you get a lot of feedback and
intraday action that is applicable to
longer term charts but you can't i can't
teach long-term day trading i'm sorry
long-term trading on daily chart inside
of 12 months adequately it can't be done
because you're only looking at a scope
of one year
but with intraday it's like compressing
years of data
in just 30 years what's it not even 365
days really 200 some days that we're
gonna be together
so let's look at the daily range
suddenly expansion retracement reversal
and consolidation mean something
every day starts with consolidation
asian range
after midnight there's a manipulation
that takes place
that's expansion
it's coming in the form of a judah swing
what is it doing it's making the higher
low
in london that's the london swing for a
reversal that's a run on stops
then there is another expansion move
okay down into the
new york session then there's going to
be what another consolidation that's the
new york consolidation going into the 8
to 8 30 news embargo lift where
there's going to be another injection of
liquidity or a reversal
then there'll be another expansion
and then we go into london close which
is another reversal condition
and then what happens the market goes in
consolidation for the rest of the day
so we have a way of looking at these
things and applying these concepts to
time of the day
and repeating characteristics
now let's get back to the interbank
price delivery algorithm
the daily range structure
can be really
broken down and simplified with
it starts with a price equilibrium
that's asian range
then there's a manipulation and that's
always going to come by way of some news
event some news driver either
at the time of the manipulation or just
before it
that's the judas swing
then we'll see a range expansion
in other words after the higher low is
formed the range will start expanding
it'll go down into five o'clock in the
morning new york time
or go up
into that time window depend upon the
daily direction we're going to use the
perspective as a by day
that means that asia
the asian range has a small
consolidation and then right after
midnight new york time there's a drop
down in price that's the manipulation
making the false move for the low
there's a range expansion
then it goes into the reversal that's
classic
london open
scenario where it shoots down runs the
stops and then what happens it expands
again
there's another range expansion into
what five o'clock in the morning
new york time
between five o'clock in the morning to
eight o'clock in the morning in that
time window the market will go back into
consolidation
then it will have a retracement between
8 o'clock and 8 30 in the morning new
york time
then it will have either a reversal in
new york session or another expansion
move the range will expand and make the
rest of the day going up into 10 o'clock
or 11 o'clock in the morning new york
time where it will have a reversal again
that's london close then the market will
go into consolidation ending true day at
1900 on forex ltd's
platform if you follow along with the
videos we've been doing so far this
month you'll know exactly what i'm
talking about
so we can see the interbank price
delivery algorithm
on a daily basis by studying these
events and then seeing it over a period
of time you'll know
what is most likely to happen now let's
look look at a little bit further
if we're looking at price delivery and
this is the model that comes by way of
my understanding of how the interbank
feeds price to everyone
if we're focusing on delivery of price
we have to understand that it all starts
with a consolidation
nothing can happen until consolidation
consolidation is when the market's quiet
why is that important because that's
when the orders are building up in the
marketplace the market makers will allow
orders to build up above and below the
range
the next stage is always expansion it's
not consolidation to retracement it
can't retrace it hasn't moved anywhere
it has it can't go consolidation
reversal because it has to come out of
the consolidation so when you see a
consolidation or holding pattern
you got to think the next leg is going
to be in price it's going to be an
explosive move or an impulse like
impulse price swing
movement you need to see movement
by determining what that movement is and
what direction is relative to the
conditions you're trading in
once we're in the expansion stage okay
then you have a choice
it can retrace come back to the order
block it just left behind and then
recapitalize that and then make another
leg up or down relative to
the direction it's moved
or
once it's moved in the expansion it can
reverse once it reverses
okay there'll be another expansion then
it goes back to a consolidation
the main thing is i want you to
understand is it never goes
consolidation retracement it never does
consolidation reversal
it's always consolidation expansion and
then from expansion it goes either
retracement or reversal
it does not do consolidation expansion
consolidation
that does not happen
it does a consolidation
expansion
it retraces for another uh
move into a order block and then
recapitalize it and do the same
direction it moved when it made it
expansion or it goes from expansion to
reversal
when you understand
this
algorithm the way it moves and where it
operates
it's very
generic it's very systematic it has only
a few options to go to and
they're
time sensitive they're day sensitive
okay they're inter market related so so
when one market is moving real fast
if you understand the relationships like
i'm going to teach every couple months
you'll know where the trade setting up
because one's being held and the other
one's like letting it run which is the
importance of knowing what the euro
pound is dealing for trading five or a
cable
all these things are going to blend
together and you'll know exactly how i'm
doing these things internally and i'm
doing it on the fly i'm not measuring
things and writing this down writing
that down making notes over here i just
know by looking at price what i should
be seeing and you see it i'm thinking
out loud in the videos when i'm doing
the live sessions with you
all aiming at your better understanding
of price delivery and when you
understand these things when you get to
the the level of month eight
and month nine in the mentorship you're
going to be so strong at knowing what
the next thing is going to happen in
your in your price that you're studying
you'll know all these
four things okay there's only certain
processes that have to take place in a
certain order like i said it never goes
consolidation reversal
it never does consolidation and
retracement it goes consolidation to an
expansion move there's an impulse leg up
or down
it's either going to be traced back down
into where it just rallied up from or
it's going to rally back up into where
it just dropped down from
the consolidation starts at all
they're going to run an expansion and
then once it expands he's either going
to come back and retrace and give
another leg up or down
or it's going to reverse and then from
the reversal
start applying time
the general
structure is
consolidation in asia
expansion
reverse in london make the higher low of
the day then expand
small consolidation in new york
retrace between 8 o'clock and 8 30 in
the morning new york time
another expansion move
reverse
back to
consolidation you understand price
delivery then
you will not learn it just by what i
just explained to you just there
but you'll use this as a model
that repeats itself over and over and
over again
when you have higher time frame
directional premise
understood and then you look at this
price delivery algo
it's so
easy to know what the price is going to
do
every single day since the last week of
august we've been together
and every single day i've given you
something that went right to the pip or
had an explosive direction move where
you could have taken 50 to 60 pips out
and i don't trade that much every day
but i'm showing you
by desensitizing you to fear and greed
there's no need there's no need for
those things
what we're teaching is
consistency the ability to see these
things happening all the time
and also exercising willpower on not
wanting to make money so you're
suppressing the desire to make money
you're developing your patience and
you're
learning a great deal you have no
understanding of how much you're
learning just in these first two videos
but i'm telling you
you'll be able to look back on this
months from now and say man
that was a huge step i didn't appreciate
until now
there's a certain process the way the
price is delivered and it can't be
changed it won't be changed and don't be
afraid because you're learning it 700
people is not going to turn the whole
world around okay and they stop doing
this it's not so
again in closing
take the information i'm giving you
stuff it under your mattress stick it in
a uh you know a love letter to your
grandkids on you know how to do it but
don't market it don't don't do that okay
not because i'm gonna lose sales it's
just it's too good to share
and you're gonna see why i've kept it
for so long and not wanted to do it
and
hopefully you guys will take this
information and do something really
great with it and that means
not starting a website selling it
okay
there's nothing more i can say about
this video except for
there is a process that you're going to
learn
that is very generic and it will not
break it will not stop working and when
you look at the marketplace in your
charts i want you to think
now it doesn't matter what time frame
you're looking at i'm just using the
daily range to give you how easy it is
to see on a repeating
format so simple every day you get an
opportunity to study and see how it
works that same thing happens with a
weekly range
the weekly range is the same thing
sunday's open consolidation then there's
an expansion move in monday
then what there's a reversal on tuesday
or monday
and then what there's another expansion
move
then it goes back into consolidation
mid-week and it's either going to do
what it's going to reverse
or
it's going to retrace
it's never doing consolidation
retracement it's never doing
consolidation reversal
it's consolidation expansion then from
expansion you're making a choice it's
either going to retrace back or it's
going to reverse
trust me it seems like you still have a
lot of choices to make but it's not
and when you understand what you're
looking at in terms of price you'll know
if it's really leading to a reversal or
if it's really going to retrace and give
you another opportunity to get in that
another leg up or down that you saw in
the first impulsive move
and believe me you'll need to go back to
this video even though it's the second
one you'll come back to this video as we
give more
details along the lines of price
delivery over the next couple months
in month four and five you'll still
refer back to this one and you'll see
there it is it's been there all along
so that guy's gonna wish you good luck
and good trading
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