Asian Range:- ICT Time and Price Theory

Summary

In this video, the concept of the 'Asian Range' in trading is explored, focusing on its significance in predicting intraday price movements. The Asian Range, which spans from 8 PM to midnight New York time, marks a consolidation period before the day's price swings. The video explains how traders can use the Asian Range to assess market sentiment and make informed decisions, whether the market is bullish or bearish. Key strategies like breakout trading, utilizing the midnight open, and understanding the market's institutional order flow are also discussed to help traders effectively capitalize on these patterns.

Takeaways

• 😀 The Asian Range refers to the price action between 8 PM and midnight New York time, which serves as a crucial indicator of future intraday price movement.
• 😀 The Asian Range helps traders understand market sentiment and build a framework to anticipate price movement for the rest of the day.
• 😀 Breakout traders use the Asian Range to place buy and sell stops above and below the range, waiting for a breakout.
• 😀 The Asian Range is used in both bullish and bearish conditions to anticipate institutional buying or selling once the price breaks certain levels.
• 😀 In bullish conditions, when the daily bias is confirmed, traders extend the Asian Range high and low into the future to anticipate price moves.
• 😀 A bullish entry can be made by buying when the price returns to the Asian Range high or after a break above it, with a stop loss below the Asian Range low.
• 😀 The Midnight Open refers to a reset in market algorithms that begins at midnight New York time, marking the start of new intraday movement.
• 😀 In bullish conditions, traders can buy below the Midnight Open price, using a stop loss of 30-40 pips and a target of 60-80 pips for a 1:2 risk-to-reward ratio.
• 😀 The market behavior post-Midnight Open involves price often going lower initially before showing institutional buying if the daily bias is bullish.
• 😀 In bearish conditions, traders extend the Asian Range high and low into the future, and anticipate institutional selling when the price returns to the Asian Range low.
• 😀 The Asian Range provides a repetitive framework for intraday price action, with the key difference between bullish and bearish days being the manipulation and distribution zones above or below the range.

Q & A

What is the Asian Range in trading?

The Asian Range refers to the price action between 8 PM and midnight New York time. It includes the highest high and lowest low within that period, which is considered important for predicting future intraday price movements.

How does the Asian Range help traders in identifying market trends?

The Asian Range creates a framework for the market, helping traders understand the potential direction of price action. By analyzing the high and low of this range, traders can anticipate bullish or bearish market conditions based on their directional bias.

What is the significance of the Midnight Open?

The Midnight Open resets the algorithm for the day’s intraday movements. It marks a crucial point where the market’s directional bias is confirmed, especially in the context of bullish or bearish conditions.

How can the Asian Range be used in a bullish market?

In a bullish market, traders extend the Asian Range’s high and low into the future. When the price returns to the Asian Range high after a breakout, institutional buying is anticipated, signaling a potential opportunity to buy.

How does the Asian Range relate to breakout traders?

Breakout traders place buy stops above the Asian Range high and sell stops below the Asian Range low. These orders are activated when the price breaks out of the range, creating potential trading opportunities.

What is the importance of confirming a directional bias before trading the Asian Range?

The directional bias must be confirmed (either bullish or bearish) before utilizing the Asian Range. This ensures that the trader’s strategy aligns with the overall market sentiment, improving the likelihood of successful trades.

How do traders utilize the Asian Range in a bearish market?

In a bearish market, traders extend the Asian Range’s high and low into the future. When the price returns to the low of the Asian Range, institutional selling is anticipated, offering an opportunity to sell.

What is the significance of the low and high of the Asian Range in terms of order placement?

The high and low of the Asian Range are critical as they indicate where buy stops and sell stops are placed. Buy stops are placed above the high, and sell stops below the low, creating opportunities for breakout traders when these levels are breached.

How does the Frankfurt and London open relate to the Asian Range?

The Frankfurt and London opens follow the Asian Range, and the price action before these openings can provide insights into the market’s behavior for the rest of the day. This period helps traders anticipate potential intraday movements based on the Asian Range framework.

What role does backtesting play in understanding the Asian Range strategy?

Backtesting allows traders to observe the effectiveness of the Asian Range strategy over time. By analyzing historical data, traders can gain a clearer understanding of how the price interacts with the Asian Range and the Midnight Open, refining their approach to intraday trading.