PD Array + SMT Divergence = Holy Grail

Summary

In this video, the speaker introduces a powerful trading concept known as SMT (Smart Money Technique) Divergence, which can significantly improve win rates by analyzing price action in correlating pairs or assets. The speaker walks through step-by-step examples, explaining how to identify SMT Divergences between pairs like EUR/USD and GBP/USD, and shows how to use higher timeframe PD arrays and lower timeframe confirmations to take trades. This strategy helps traders avoid losing trades and improve their market predictions. The video also offers information on a private course with advanced trading strategies.

Takeaways

• 💡 The main trading concept discussed is SMT (Smart Money Trading) Divergence, which is said to significantly improve trading success and win rates.
• 🧠 SMT Divergence occurs between two or more correlated assets or currency pairs, such as EUR/USD and GBP/USD, or NAS100 and S&P500.
• 📈 The concept involves analyzing when one asset makes a higher high while the correlated asset fails to do so, indicating market strength or weakness.
• 📊 Traders should look for SMT Divergence at higher time frame PD (Price Delivery) arrays, then drop down to lower time frames to confirm market reversals.
• 🔄 The speaker emphasizes combining SMT Divergence with market structure shifts for higher accuracy and better trading results.
• 📉 Once SMT Divergence is identified, traders should look for breaks of structure as an entry signal for potential trades.
• ⏳ SMT Divergence can work with various trading models, including Market Maker models, external-to-internal liquidity methods, and simple order flow strategies.
• 🔍 There is an SMT Divergence indicator available (Lux Algo), though the speaker recommends manually identifying divergences for better accuracy.
• 🛠 In trades, using lower time frames after detecting SMT Divergence at key levels can help refine entry points and improve risk-to-reward ratios.
• 💼 The speaker offers a private trading course, Discord server access, signals, and strategies to help traders get funded and improve their performance within three months.

Q & A

What is the main concept the speaker emphasizes in the video?

The main concept emphasized is SMT (Smart Money Technique) Divergence, which the speaker claims can significantly improve trading success and win rates.

What is SMT Divergence?

SMT Divergence occurs between two or more correlating pairs or assets. It identifies differences in price behavior, such as when one pair creates a higher high, but a correlating pair fails to do so, indicating potential market weakness or strength.

Which assets or pairs can be used to identify SMT Divergence?

SMT Divergence can be used on correlating pairs or assets, such as EUR/USD and GBP/USD, Bitcoin and Ethereum, NAS100 and S&P 500, or US30 and NAS100.

How can traders use SMT Divergence to improve their trades?

Traders can look for SMT Divergences at key levels or PD arrays. When one asset shows weakness and another shows strength, it signals market sentiment, helping traders avoid bad trades and increase accuracy.

What is a PD Array in the context of this strategy?

PD Array refers to Price Delivery Arrays, which are higher time frame price levels where significant price reactions occur. Traders use these levels to identify key moments for SMT Divergences.

How do you take trades based on SMT Divergence?

Traders wait for SMT Divergence and then look for a market structure shift or a break of structure. The divergence itself can sometimes serve as a confirmation to take the trade directly.

What is the benefit of using SMT Divergence compared to other trading strategies?

The speaker claims that SMT Divergence is more powerful than market structure shifts alone. By combining SMT Divergence with other techniques, traders can achieve a higher win rate and stay on the right side of the market.

How does the speaker suggest combining SMT Divergence with time frames?

The speaker suggests using higher time frame PD Arrays to mark key levels, then dropping down to lower time frames, such as the 1-hour or 5-minute, to identify SMT Divergence and market structure shifts.

What role does the SMT indicator play in this strategy?

There is an SMT indicator that can help identify divergences automatically. However, the speaker recommends manually checking for SMT Divergences, as the indicator may miss certain setups.

What trading pairs or assets are suggested for finding SMT Divergences?

Suggested pairs include EUR/USD and GBP/USD, USD/JPY and AUD/JPY, NAS100 and S&P 500, and Bitcoin and Ethereum. The speaker also provides other examples such as US30 with NAS100 or S&P500, and GBP/JPY with CHF/JPY.