Stupid ICT IFVG Trading Strategy That Works

Summary

This video breaks down a simple yet effective trading strategy, focusing on key concepts like higher time frame bias, liquidity sweeps, and fair value gaps. The trader emphasizes the importance of simplicity and consistency in trading, using real-time examples and a step-by-step approach to frame trades. By analyzing higher and lower time frame levels, using SMT divergence, and trading within a specific New York time window, the strategy helps identify high-probability setups. The trader also highlights the importance of protecting capital and taking profits strategically, with detailed examples of trades executed live.

Takeaways

• 😀 Trading should be simple, not overly complicated with excessive indicators and patterns.
• 😀 Consistency and profitability in trading come from mastering key concepts, not overthinking the process.
• 😀 The core of the trading strategy is identifying higher time frame key levels and waiting for lower time frame confirmations.
• 😀 The daily time frame is essential for framing your market bias, analyzing price movement from liquidity to liquidity.
• 😀 A bearish bias can be confirmed if the daily high is taken out and there is a fair value gap, whereas a bullish bias is supported if price is inside a fair value gap.
• 😀 Key trading window: Trade after 9:30 AM New York time, and avoid trades before or after the specified window.
• 😀 Use a liquidity sweep on the 15-minute time frame to confirm bearish or bullish bias and frame trades accordingly.
• 😀 Entry model involves using the 1-minute time frame after a fair value gap is confirmed on higher time frames like 15 minutes or 4 hours.
• 😀 SMT divergence can be a helpful confirmation but is not crucial unless the bias is unclear.
• 😀 Always trade on the highest time frame fair value gap available (up to 5-minute max).
• 😀 Protect capital by setting break-even points as soon as the closest liquidity level is reached and taking partial profits at a 1:1 risk-to-reward ratio.

Q & A

What is the key reason traders fail to see consistency in their trading, according to the speaker?

The key reason traders fail to see consistency is that they tend to overcomplicate their trading. The speaker emphasizes that trading should be simple and straightforward, not requiring excessive analysis or indicators.

What are the two main factors in the speaker's trading strategy?

The two main factors in the speaker's strategy are identifying higher time frame key levels and waiting for lower time frame confirmations before making a trade.

What time frames does the speaker primarily use to frame their bias and make trading decisions?

The speaker starts by framing their bias on the daily time frame. If the bias is unclear, they move down to the 4-hour time frame for further analysis.

How does the speaker determine their bias in a trading session?

The speaker determines their bias by examining price action on the daily time frame, looking for liquidity sweeps or fair value gaps. They also consider whether price has taken out certain highs or lows to set a bullish or bearish bias.

What is the trading window recommended by the speaker?

The recommended trading window is from 9:30 AM to 11:30 AM New York time, with the speaker only focusing on trades within this time frame.

What role do fair value gaps play in the strategy outlined in the script?

Fair value gaps are key levels the speaker uses to identify potential price reversals or continuations. They assess fair value gaps on various time frames, such as the 15-minute or 1-minute time frame, and use them to enter trades with a higher probability of success.

What is SMT divergence, and how does the speaker use it in their strategy?

SMT (Smart Money) divergence occurs when there is a price discrepancy between two correlated instruments, such as NQ and ES. The speaker uses SMT divergence as an additional confluence when their bias is neutral, as it may signal a price movement in the desired direction.

Why does the speaker primarily use lower time frames like the 1-minute or 2-minute for entries?

The speaker uses lower time frames for entries because they want to capitalize on smaller, quicker moves. This allows them to secure profits earlier and manage risk by moving to break-even quickly, protecting their capital.

What is the significance of liquidity levels in the speaker’s trading strategy?

Liquidity levels are critical because they represent areas where price is likely to react. The speaker targets liquidity pools, such as equal highs or lows, and uses them to frame trade entries and exits, aiming for better risk-to-reward ratios.

How does the speaker handle trade entries when market structure shifts?

The speaker aims to enter trades before market structure shifts occur, ensuring that they enter at favorable levels before the larger market movement takes place. If the market structure shifts before their entry, the setup is considered invalid, and they do not take the trade.