How I trade US30!

Summary

This video outlines a trading strategy specifically for US30, focusing on identifying key bank zones during the US session. The strategy emphasizes waiting for entries after the NYSE open at 2:30 PM, using lower time frames to spot market movements and entries. The speaker explains how to identify important price levels and key zones to target for high-risk-reward trades, including during major news events like CPI data. The strategy’s core idea is to track the market using these precise zones, capitalizing on market reversals and trends, with examples of successful trades.

Takeaways

• 😀 U.S. session time is crucial for trading US30, from 1 PM to 10 PM in British time (8 AM to 5 PM EST).
• 😀 The U.S. session open at 2:30 PM (EST) is a critical time for observing market movements.
• 😀 Bank zones, formed during the U.S. session, are key for identifying potential entry points for trades.
• 😀 Entries should be taken only after 2:30 PM, and all bank zones formed between 1 PM and 10 PM are important for analysis.
• 😀 The strategy focuses on lower time frames, typically 5-minute charts, to identify opportunities based on bank zones.
• 😀 Key support and resistance zones are established based on past price actions during U.S. sessions.
• 😀 Once a bank zone is identified, wait for price to tap into it and look for rejections or bullish/bearish candles for entries.
• 😀 Set stop losses just below the identified bank zones to protect from reversals, and target higher price zones for profits.
• 😀 The strategy also applies to high-impact news events like CPI data, where market behavior can be more volatile.
• 😀 The strategy requires flexibility to adapt to changing market structures, such as transitioning from bullish to bearish when a significant low is broken.

Q & A

What is the importance of the US session for trading US30?

The US session, running from 1 PM to 10 PM in British time (or 8 AM Eastern Standard Time), is critical for trading US30 because the New York Stock Exchange (NYS) open at 2:30 PM is when price movements tend to become more significant. This session provides the key market structure and 'bank zones' from which trades are taken.

What are bank zones and how are they used in the strategy?

Bank zones are price levels formed during the US session where the market has previously shown significant movement. These zones are used to identify potential points of interest for entering trades. The strategy involves waiting for price to tap into these zones and look for rejection patterns to confirm trade entries.

Why is the 2:30 PM time significant for entering trades on US30?

At 2:30 PM, which is an hour and a half after the US market opens, it marks the point when price movements become more predictable and reliable. The strategy focuses on identifying the 'bank zones' formed during the earlier US session and looking for confirmations to enter trades.

How do you identify where to enter trades in the lower time frames?

In the lower time frames, particularly the 5-minute chart, the key is to identify when price taps into previously established bank zones. Once price reaches these zones, you look for rejection patterns, such as long lower wicks or specific candlestick formations, to confirm potential trade entries.

What is the risk-to-reward ratio typically targeted in this strategy?

The strategy targets a risk-to-reward ratio of 1:3 or higher, depending on the trade setup. For example, in one instance, the risk-to-reward ratio achieved was 1:3.79, demonstrating the strategy's effectiveness in capturing large moves.

How does the strategy handle high-impact news events, such as CPI data?

During high-impact news events like CPI data releases, the strategy adapts by considering the trend, but also focusing on the price action around key bank zones. The approach can yield substantial moves, such as the large spike seen during a news release, where price taps into a bank zone before pushing significantly in the expected direction.

How do you manage trade exits when the price reaches the target zone?

When price reaches the target zone, the trader can go to break even at the previous US high or low, depending on the direction. If price continues moving in the expected direction, the trader aims to hit the full target zone. If price shows signs of reversal, the trader can adjust the stop loss or exit early.

What should you do if the price doesn't immediately respect a bank zone?

If the price doesn't immediately respect a bank zone, you need to be patient and wait for a clearer confirmation. This could involve looking for price to return to the zone after a temporary deviation or waiting for a break and retest setup, depending on the overall market structure.

How does market structure affect trade decisions in this strategy?

Market structure plays a vital role in determining the bias for the trade. For example, if a significant low is broken, the bias shifts from looking for buys to only considering sells. This change in market structure helps to guide trade decisions and ensures that the trader only takes trades in alignment with the prevailing trend.

What is the role of higher time frames in the strategy?

Higher time frames provide the broader market context and trend direction. For example, if the higher time frames show a bullish trend, the strategy will focus on catching the lows during the US session. Conversely, if the market structure shifts, such as a broken low, the focus changes to selling rather than buying.