ICT Market Maker Model made EASY

Summary

In this video, the speaker explains Market Maker models in a simplified, user-friendly way, focusing on key concepts such as draw on liquidity, consolidation, and order flow. The video delves into proprietary terms like SD (sharp turn), OG (original consolidation), and Silver Bullet, while emphasizing the fractal nature of these patterns across different time frames. Using real chart examples, the speaker demonstrates how liquidity and price action play a crucial role in market behavior, illustrating high-probability entry points and trade setups in both bullish and bearish scenarios.

Takeaways

• 😀 Market Maker Models follow a specific sequence: draw liquidity, original consolidation (OG), opposite PD array touch, sharp turn (SD), order flow shift, and Silver Bullet (highest probability entry).
• 😀 The 'OG' (Original Consolidation) helps identify whether a consolidation will be respected or taken out by price action.
• 😀 A Silver Bullet entry is a sharp, high-probability, explosive move in price that occurs near the original consolidation area, often with minimal stop-run.
• 😀 The concept of time is fractal – market maker models repeat on different timeframes (daily, weekly, etc.), with the same principles applying at every level.
• 😀 Market Maker Models can be applied to both buy and sell models, with each side featuring its own unique set of entry points and liquidity objectives.
• 😀 The 'SD' or 'Sharp Turn' is a significant price move meant to entice traders into thinking price will move in the opposite direction before continuing in the desired direction.
• 😀 A successful market maker model setup requires identifying the right discount and premium arrays, and understanding the broader narrative of the market's liquidity.
• 😀 Price movements are cyclical and often follow the pattern of consolidation, expansion, retracement, and reversal, which is fractal in nature.
• 😀 In lower timeframes, market maker models tend to show explosive price moves, whereas on higher timeframes, you may see more retracements.
• 😀 Recognizing overlapping fair value gaps or balanced price ranges (BPR) helps identify sharp turns (SD) and their potential significance for trades.

Q & A

What is the primary concept behind the Market Maker model discussed in the video?

The Market Maker model explained in the video revolves around understanding price action dynamics and the concept of liquidity. The model outlines how price moves from consolidation to expansion, with certain phases like original consolidation, order flow shifts, and sharp turns (SD), all while targeting liquidity areas (buy or sell sides).

What does 'OG' (Original Consolidation) refer to in the Market Maker model?

'OG' refers to an initial consolidation pattern from which price moves away to capture liquidity. It's considered a key phase in the Market Maker model as it sets the stage for future price movements, marking a foundation before a larger move occurs.

How does the 'Sharp Turn' (ST) fit into the model, and why is it important?

The 'Sharp Turn' (ST) is a critical phase where price aggressively moves in one direction (either up or down), tempting traders into a false sense of direction before reversing sharply. It serves as an indication that price will move in the opposite direction, trapping traders and setting up a reversal toward liquidity targets.

What is meant by 'Silver Bullet' in the context of the Market Maker model?

The 'Silver Bullet' is the final, high-probability entry point in the Market Maker model, usually marked by an explosive move after a small retracement. This entry is considered the most reliable and offers the greatest chance of success because price aims to capture liquidity quickly and decisively.

What is the role of liquidity (draw on liquidity) in the Market Maker model?

Liquidity is essential in the Market Maker model, as it dictates where price targets are set. Draw on liquidity refers to areas in the market where there is a concentration of orders, typically at key levels like previous highs, lows, or consolidation zones, which the market maker aims to tap into before reversing.

How does the fractal nature of the Market Maker model work?

The fractal nature of the Market Maker model means that the same principles apply across different time frames. Whether on a one-minute chart or a daily chart, the basic phases—consolidation, expansion, retracement, reversal—repeat themselves in a similar pattern, allowing traders to apply the model consistently across various time scales.

Why is time important in applying the Market Maker model?

Time is crucial because the Market Maker model functions across different time frames (weekly, daily, hourly, etc.), and each timeframe might show a slightly different pattern. For instance, on a lower timeframe, price action might have a single expansion, while higher timeframes might show multiple retracements and larger moves.

What does 'Order Flow' refer to, and how is it used in the Market Maker model?

Order flow refers to the direction of price movement and how it behaves in relation to market liquidity. In the Market Maker model, identifying when order flow switches from one side to another (e.g., from a bearish to a bullish trend) is key to determining entry points and predicting the next price action.

What is the significance of the 'Premium Array' and 'Discount Array' in the model?

The 'Premium Array' and 'Discount Array' refer to the relative price zones where market participants are likely to buy or sell. A 'Discount Array' is typically seen as a more attractive entry zone for buyers, whereas a 'Premium Array' is where sellers are more likely to enter. These arrays are important in the context of price reaching certain levels before a reversal or continuation occurs.

How does the Market Maker model incorporate risk management?

Risk management is integrated through careful entry points and trade sizing. For example, when entering with a 'Silver Bullet,' traders might risk a normal position size since it’s considered a high-probability trade. However, during other entries, such as at 'Sharp Turns' or 'Discount Arrays,' traders might risk smaller amounts until the market shows confirmation of the trend.