How I Measure Price Moves Using STDV Projections - ICT Trader

Summary

In this video, Gaddy, a day trader and live streamer, explains how he uses measured moves and standard deviation projections in his trading strategy. He emphasizes the importance of understanding market narrative and liquidity to effectively use these tools for predicting price movements. By anchoring these projections on key market levels, Gaddy showcases how to anticipate price expansions in real-time. He also shares practical examples of his approach, offering insights into how traders can integrate these tools into their own models for better decision-making.

Takeaways

• 😀 Gaddy is a day trader who livestreams his trades on YouTube, showcasing his ICT trading model.
• 😀 Measured moves and standard deviation projections help estimate how far price could move in a given direction based on previous price action.
• 😀 These tools are not foolproof but are valuable for anticipating potential price expansions.
• 😀 Narrative context and liquidity are essential to making standard deviation projections effective – it’s important to know what you’re measuring.
• 😀 Standard deviation projections show how far price could expand, with common targets being -1, -2, or even -4 standard deviations.
• 😀 Gaddy emphasizes the importance of having a clear narrative when using these tools. Without it, projections may not be accurate.
• 😀 The Fibonacci retracement tool can be used in conjunction with standard deviation projections to track potential price movements.
• 😀 Standard deviation tools should be anchored from key price levels (like low to high of a move) to measure possible price expansions.
• 😀 Gaddy recommends overlapping standard deviation projections with drawn liquidity levels (such as previous day lows) for better trade confluence.
• 😀 The power of live market replay allows Gaddy to confirm if his projections and trades align with expected price movements.
• 😀 While some traders take profits at specific standard deviations (e.g., -1 or -2), Gaddy prefers to align his targets with strong liquidity levels, adapting to the market's behavior.

Q & A

What is the main focus of the video?

The video focuses on explaining measured moves and standard deviation projections in trading, specifically how these tools can help in predicting price movements and making trading decisions.

What is the significance of standard deviations in the trading model?

Standard deviations are used to project potential price movements by measuring how far a price could expand, offering a mathematical approach to anticipate future moves in the market.

Why is it important to have a narrative and drawn liquidity when using standard deviations?

Having a narrative and drawn liquidity is crucial because it ensures that you're measuring the right price movements. Without context, measuring random price actions leads to unreliable projections.

What analogy does the speaker use to explain the importance of measuring the right thing?

The speaker uses an analogy of measuring a piece of wood but using a piece of gum instead. This illustrates how measuring the wrong thing or not having the right context can lead to meaningless results.

How does the speaker use Fibonacci retracements in their trading model?

The speaker uses Fibonacci retracements to set expectations for price movements, focusing on specific Fibonacci levels as targets for potential price expansion.

What is the typical time frame when the speaker trades?

The speaker typically trades between 9:30 AM to 11:00 AM, with occasional trades in the PM session. This time frame is where they find their edge in trading.

How does the speaker define a measured move in trading?

A measured move is the projection of price expansion based on an initial price move, used to estimate how far the price might continue in the same direction or reverse.

What are the key components of the speaker's trading strategy?

The key components include using standard deviation projections, identifying liquidity zones, and following price actions like accumulation, manipulation, and distribution, with a focus on aligning these with larger market narratives.

What is the role of time in the speaker's trading model?

Time plays a significant role in the speaker’s model, especially with key time markers like 9:30 AM and 10:00 AM, which are used to set expectations for price movements based on previous price action.

How does the speaker decide where to take profits in their trades?

The speaker typically takes profits at key levels that align with the negative standard deviation projections, often around negative 1 to negative 1.5 standard deviations, depending on the size of the manipulation leg.