ICT Charter Price Action Model 6 - Universal Trading Model

Summary

In this comprehensive guide on price action trading, the speaker introduces a universal model focused on buy-side liquidity runs, low resistance, and fractals. The discussion emphasizes identifying key liquidity levels across any time frame and highlights the application of market maker buy models. The speaker shares personal insights on trading setups, including the importance of identifying bullish conditions, the role of premium arrays, and using price action to anticipate market moves. By leveraging the concepts taught in mentorship, traders can develop a flexible approach to scalping, day trading, and swing trading, while ensuring they avoid overtrading.

Takeaways

• 😀 The Universal Trading Model emphasizes identifying liquidity draws and buy side low resistance liquidity runs using fractals.
• 😀 The model is applicable across multiple timeframes, with the focus being on liquidity targets rather than specific timeframe-based strategies.
• 😀 Key to trading effectively is understanding the market's potential to reach liquidity pools above or below key levels such as previous highs or bearish order blocks.
• 😀 Recognizing a bullish condition involves identifying a liquidity draw, which is a range where price action is expected to move higher, potentially filling a fair value gap or reaching a premium array.
• 😀 A trader can identify entry points at key retracements such as at fair value gaps, order blocks, or after the market has formed a new impulse move higher.
• 😀 Point number one refers to the first retracement after an initial impulse leg, which is a potential entry point for traders who missed the early stage of the move.
• 😀 Secondary retracements also offer potential buying opportunities, with traders able to adjust entries based on missed opportunities or changes in market conditions.
• 😀 The model applies to different trading styles, from scalping and day trading to swing trading and long-term position trading, depending on the trader’s chosen timeframe and strategy.
• 😀 Identifying a consolidation or accumulation area can guide traders to expect a liquidity run, with equal highs or price blocks as targets for liquidity absorption.
• 😀 The key to applying the model effectively is flexibility across timeframes, combining top-down analysis and understanding how market maker behavior influences price movements.

Q & A

What is the focus of the trading model discussed in the video?

The video focuses on a universal trading model that deals with buy-side low resistance liquidity runs and fractals. The model emphasizes understanding market liquidity and how to identify buying opportunities based on price action.

How does the speaker define the 'universal' aspect of their trading model?

The term 'universal' refers to the ability to apply the model across different timeframes, whether for day trading, scalping, or longer-term swing trading. The key is understanding the liquidity dynamics and identifying setups regardless of the time horizon.

What is meant by a 'liquidity draw' and how does it relate to the market?

A liquidity draw refers to the market's tendency to seek out liquidity above or below current price levels. The model suggests that identifying these areas of liquidity helps traders anticipate potential price movements and buying opportunities as the market targets those levels.

How do 'premium arrays' fit into the trading model?

Premium arrays are areas of the market where liquidity is drawn to, such as previous highs, bearish order blocks, or liquidity voids. Traders look to these levels as potential zones for price to reach, retrace to, or reverse from.

What are 'fractals' and how are they used in the model?

Fractals are recurring patterns in price action that indicate potential support or resistance levels. In the model, fractals are used to identify key buying or selling opportunities, particularly during liquidity runs.

How can the model be applied to different timeframes?

The model is flexible and can be applied to any timeframe. Whether you're looking at a 15-minute chart or a weekly chart, the principles of liquidity runs and market structure can be used to identify setups and make informed trading decisions.

What role does consolidation play in this trading model?

Consolidation represents a period where price ranges and forms potential support or resistance zones. These areas are important because when the market breaks out of consolidation, it often targets liquidity at prior highs or lows, providing potential entry points for trades.

What is the significance of 'Point 1' and 'Point 2' in the model?

'Point 1' refers to the initial buy opportunity after a price retracement, typically back into an order block or fair value gap. 'Point 2' is a secondary buying opportunity after a further retracement or continuation, both with the expectation of price reaching a targeted liquidity zone.

How does the speaker suggest managing trades in real-time?

The speaker suggests managing trades by being patient and allowing the market to form clear liquidity patterns. The trader should be able to spot and act on buy points at 'Point 1' and 'Point 2,' using stop-loss levels around key support or resistance areas such as order blocks.

What is the importance of understanding the market maker buy and sell models?

Understanding market maker models helps traders anticipate price action and liquidity runs. The buy model involves price expansion with low resistance, while the sell model typically involves price retracing to a discount array or lower support. These models guide traders in predicting price movements and making strategic trades.