20 PERFECT ICT FVG TIPS TO ELEVATE YOUR TRADING ! - ICT CONCEPTS

Summary

This video delves into advanced trading concepts, focusing on tools like fair value gaps (FVG), premium and discount price levels, and inversion fair value gaps. It explains how these elements, along with volume imbalances and market structure shifts, can help traders identify high-probability entry points. The strategy emphasizes using layered confluences to boost accuracy, such as spotting divergences through correlated assets (SMT). With practical examples and a focus on risk management, the video teaches how to navigate market complexities and improve trading decisions with a structured approach.

Takeaways

• 😀 FVG (Fair Value Gaps) represent areas where price hasn't fully filled in, and identifying these gaps helps traders find optimal entry points in both discount and premium zones.
• 😀 Premium and Discount pricing refers to overbought (premium) and oversold (discount) market conditions. Recognizing these helps traders understand whether an asset is overpriced or underpriced.
• 😀 SMT (Smart Money Techniques) is used to detect discrepancies between correlated assets. For example, if one asset doesn't reach its FVG while others do, it might signal a potential market reversal.
• 😀 Volume Imbalances are gaps where price moves quickly, creating imbalanced trading activity. These zones act like magnets, attracting price back for potential trading opportunities.
• 😀 Inversion FVGs occur when a price trades through a gap and returns to it, reversing its original direction. It's similar to support turning into resistance (or vice versa) and provides high-probability entry points.
• 😀 Layering Confluences involves combining multiple technical factors (like FVGs, volume imbalances, order blocks) in the same area to increase the chances of a successful trade.
• 😀 It's important to understand the context of Premium and Discount zones in relation to the broader market narrative, ensuring that traders are operating within favorable conditions.
• 😀 A Dealing Range is a key concept that helps traders identify areas where price is likely to react. Navigating these ranges and understanding the midpoint is crucial for identifying entry points.
• 😀 When price taps into an FVG or volume imbalance, traders should consider whether it is a discount or premium zone to decide if the trade is aligned with the broader trend.
• 😀 In a fast-moving market, price might only revisit the first valid FVG in its path without retracing to the deeper discount zones, making it essential to observe the market's behavior carefully.
• 😀 Layering inversion FVGs with traditional FVGs creates dynamic opportunities where price can react strongly to these areas, especially when combined with a clear market structure shift.

Q & A

What is the difference between premium and discount in the context of fair value gaps?

Premium refers to when the price is trading at a higher level in a bearish market, effectively selling at an inflated price. Discount refers to when price is trading lower in a bearish market, effectively buying at a cheaper price. Understanding these concepts helps in identifying favorable entry and exit points based on market conditions.

How do fair value gaps (FVGs) play a role in market analysis?

Fair value gaps are areas where price has moved too quickly, leaving behind an imbalance. These gaps often act as potential entry or exit points, where price might revisit to fill the gap. Identifying these gaps helps traders to understand market dynamics and potential future price movement.

Why is it important to focus on the higher time frame narrative when identifying fair value gaps?

The higher time frame narrative provides the broader market context, helping to understand the overall trend and where price is likely to go. Identifying fair value gaps in alignment with this larger narrative increases the probability of successful trades.

What is an inversion fair value gap and how is it used in trading?

An inversion fair value gap occurs when a price level, which initially acted as a resistance (in the case of a bearish gap), is later used as support after price breaks through it. This indicates a shift in market structure and can be a key entry or exit point.

How can volume imbalances be used to predict price movement?

Volume imbalances are small gaps where price has moved quickly and left a void in volume. These imbalances can act as price magnets, drawing price back to them. They can also be used to identify potential reversal or continuation points.

What role does SMT (Smart Money Tool) play in market analysis?

SMT involves observing correlated assets or indices for discrepancies. If one asset moves toward a fair value gap while others do not, this can indicate a potential divergence or reversal in price, which can help traders identify trade opportunities.

How can order blocks be used in conjunction with fair value gaps?

Order blocks are the last significant candles before a price move. When combined with fair value gaps, they create layered confluences that enhance the accuracy of trade setups. For example, if an order block aligns with a fair value gap, it signals that price may respect this level as support or resistance.

Why is it important to study the relationship between price levels and liquidity?

Price often moves towards areas of liquidity, such as stop-loss or take-profit zones. By understanding where liquidity is concentrated, traders can anticipate where price is likely to head next, which helps in making better trade decisions.

How can layering confluences improve trading accuracy?

Layering confluences involves combining multiple tools, such as fair value gaps, order blocks, and liquidity levels, to create a higher probability trade setup. When these elements align, it indicates a stronger likelihood that price will behave in a predictable way.

What is the significance of using the low-to-high method for identifying discount and premium zones?

The low-to-high method helps identify whether price is at a premium or discount level. By measuring from a recent low to a high, traders can determine whether the price is in a discount zone (good for buying) or a premium zone (good for selling), which aids in making more informed decisions about entries and exits.