ICT Mentorship Core Content - Month 1 - What To Focus On Right Now

Summary

The speaker explains how to adopt a smart money mindset for trading, starting from a blank slate. You analyze charts to spot unfilled highs/lows, rapid price movements, and clean levels. Document daily price action, noting weekly & daily ranges on all timeframes. Separate analysis and trade execution charts. Smart money moves price to take liquidity from uninformed money. Your goal is to understand this dynamic rather than indicators or secrets. Doing proper homework sets the foundation to see repeating patterns showing institutional order flow over time.

Takeaways

• 😀 The script discusses trading mindsets and perspectives to adopt for success
• 😯 There are two main perspectives - the smart/informed money and the uninformed/speculative money
• 🤔 The uninformed money believes indicators drive price action while the smart money controls and manipulates price
• 😮 As traders, we need to adopt the smart money perspective to profit
• 📝 We should start by logging daily price action and key levels on multiple timeframes
• 🔍 Note areas where price moves quickly or leaves equal highs/lows which act as future liquidity
• 🗓 Track the daily and weekly highs/lows and what days/sessions they form in
• 📈 Don't forecast yet - observe and document price action and market mechanics
• 😊 Suppress the desire for trading techniques initially and focus on market foundations
• 📚 Build your knowledge and experience through practice, exposure and guidance

Q & A

What is the overall theme and goal of the video series?

The overall theme is understanding the mindset and perspective traders need to have when analyzing the markets, specifically adopting a "smart money" point of view rather than a retail trader perspective.

What is the difference between smart money and uninformed/speculative money?

Smart money refers to institutional traders, banks, and other major market players who have more information and control over price. Uninformed/speculative money refers to retail traders who lack the same level of knowledge and tend to rely more on indicators.

What perspective should traders adopt according to the speaker?

Traders should adopt the perspective of a liquidity provider or smart money, viewing everyone else as a source of liquidity and recognizing that price is delivered to benefit smart money interests.

What are the four primary drivers of price delivery discussed?

The four primary drivers are retracement, expansion, reversal, and consolidation.

What daily practice does the speaker recommend for new students?

The speaker recommends creating a daily price action log with multiple time frame charts, noting recent unfilled highs/lows, areas of quick price movement, and daily highs/lows.

Why does the speaker recommend using a single currency pair at first?

To allow students to develop their own understanding rather than just mirroring the analysis on the pairs used in the course.

What should new students resist the urge to do?

New students should resist the urge to try to forecast future price movements, as that will lead to frustration.

Why does the speaker create separate analysis and execution charts?

To avoid having overly cluttered charts and to allow flexibility to update analysis without impacting live trading decisions.

What do the daily/weekly highs and lows represent?

They represent areas where liquidity is resting that the price may move towards, either stopping out positions or triggering pending orders.

How will the practices taught in this video help traders?

They will build market understanding over time by logging and analyzing repeating price behavior, aligned with smart money concepts.

Outlines

00:00

😁 Understanding Marketplace Perspectives

The paragraph discusses the importance of understanding the differing perspectives in the marketplace between informed "smart money" traders and uninformed retail traders. It contrasts their views - smart money sees everyone else as liquidity and focuses on price action, while retail traders rely too much on indicators. For new traders, not having preconceived notions about markets is an advantage in adopting the smart money perspective.

05:01

🧐 Adopting a Liquidity Provider Perspective

This paragraph elaborates on taking the perspective of a liquidity provider or smart money. It means seeing other traders as sources of liquidity, and recognizing that banks and large institutions have ultimate control over currency valuation and price movements. Understanding these two perspectives removes conflict in how we view markets.

10:03

📝 Starting Your Trading Journal

The paragraph stresses the importance of beginning traders creating a detailed daily price action log and provides specific guidelines on setting up your charts. This includes the timeframes to use, amount of visible data, marking significant levels, and tracking daily highs/lows. It is foundational but critical work for development.

15:04

🗒️ Documenting Your Analysis

Continuing from the previous paragraph, further details are provided on documenting important price levels and structure on your charts. This includes recent unfilled highs/lows, equal highs/lows, and areas where price moved quickly. Doing this mapping across timeframes builds perspective and understanding.

20:04

👁️‍🗨️ Developing Your Lens on Markets

The paragraph concludes by emphasizing the importance of building your charts and analysis in this meticulous way every trading day. This develops the lens required to interpret intraday market movements and identifies repeating patterns. Maintaining separate analysis and execution charts avoids bias.

Keywords

💡smart money

The smart money refers to professional traders and market participants who have superior insights into market movements. They are able to influence and control prices by anticipating what unsophisticated traders will do and positioning accordingly. The video teaches traders to think like and ultimately profit alongside the smart money.

💡uninformed money

The uninformed money refers to retail traders and others without professional insights or understanding of the markets. They operate on assumptions and beliefs that expose them as liquidity to be taken by smart money interests. The video aims to provide the perspective of smart money on uninformed money.

💡liquidity

Liquidity refers to the amount of buy or sell orders available in the market. Large liquidity allows market orders to be filled easily. The video depicts retail traders as a constant pool of liquidity for the smart money to access or exit positions efficiently.

💡price delivery algorithm

The price delivery algorithm refers to the mechanism by which prices are moved or 'delivered' according to the interests of smart money. Understanding this algorithm allows anticipating upcoming movements.

💡framework

Framework refers to the foundational groundwork of concepts which allow properly understanding subsequent components. The video stresses starting from square one to build frameworks enabling order flow analysis.

💡perspective

Perspective refers to one's interpretation and point of view on markets. The video contrasts the differing perspectives of smart and uninformed money as crucial for grasping the mechanics of price delivery.

💡reference point

Reference points refer to notable highs and lows on price charts. These are used to contextualize current price action and identify potential liquidity. Traders are instructed to carefully log these.

💡efficiency

Efficiency refers to markets tendency to facilitate transfers between participants. In the video efficiency is presented as slanted towards benefiting smart money interests over those of retail traders.

💡liquidity void

Liquidity voids refer to empty spaces on charts where no trading occurred. They indicate potential for price to move to those levels in order to allow exiting positions.

💡order block

Order blocks indicate areas on a chart where significant buying or selling interest exists. They are usually created by a sharp reversal in price and represent high probability areas for price to return.

Highlights

We're going to continue focusing on understanding the mindset you need for the marketplace

New traders have an advantage as they don't have bad habits or false beliefs about the markets

Uninformed traders believe indicators influence price, but smart money controls price movements

Understand both smart money and uninformed money perspectives to not vilify either side

Start a daily price action log to chart market levels and note areas of swift price movement

Note recent highs and lows not yet retested as they will likely be influential

Identify clean double highs and lows as price tends to revisit equal areas

Note what day and time weekly highs/lows form as it aids future expectations

Record daily highs/lows to see daily ranges and identify potential support/resistance

Resist forecasting, just start charting levels for now to build proper understanding

Watch me create daily charts/logs each day to see exactly how professionals operate

Note previous day's highs/lows on 15 min chart to see daily ranges and tendency to revisit

Add more reference points to your charts each month to build on your knowledge

Have separate chart for analysis versus executable setup to avoid rigid convictions

Learn to identify repeating patterns in price action based on reference points

Transcripts

okay folks welcome back

this is the third teaching of a series

of eight for the first month of the ict

mentorship

okay we're going to continue continuing

on our theme of understanding the

mindset that you have to have

going into the marketplace looking at

things in a little bit reverse order

then you're normally taught from a

retail perspective

and this is one

this is one of those teachings that

you're going to have that if you're new

you actually have the advantage here

for folks that have been trading for a

while that

have adopted bad habits or

an understanding or a belief that they

have an understanding

it's going to be a little bit expensive

for them because they're going to have

to

purge some of the things that they

either subscribe to or

wrestle with it until they either do or

elect not to use this insight at all

i mapped out a

a crude depiction here and i've been

using it for months actually um as a

teaching tool

but we're gonna really hammer it down in

this mentorship because it's imperative

that you know

how we as

traders are supposed to be viewing

marketplace uh data delivery um

reverse psychology

whatever the psychology of this

informed money is

it's going to be diametrically opposed

to that of the uninformed or speculative

money or quote unquote dumb

and when we have these ideas when we

look at price okay the first thing we

have to do is establish

who is the victim here you know

generally there's a victim always in

every crime

and

the perspective that the speculative

uninformed money has

is that number one they don't

acknowledge that there's a smart money

there is not an entity out there that

has uh quote unquote the right things

always on uh the right perspective

or that a market is rigged or controlled

or manipulated or has any influence over

long-term price delivery

the uninformed money

okay or

those that are uninformed in regards to

how smart money actually operates and

exists in the in the marketplace their

actual perspective really is that

indicators are the answer

and uninformed money their perspective

holds

belief that

price moves by indicators influence okay

and the influence of an indicator being

overbought or sold that is what the

precursor is to a market moving higher

or lower and i can tell you i subscribed

to that for years as a new trader and it

took a long time for me to actually be

broken away from

that type of mindset

so if you're new and you haven't been

exposed to indicator itis and you're not

infected with that yet you're actually

pretty good uh in in terms of advantage

uh those that like

to use it indicators are going to have a

little bit of a

struggle with this mentorship because

i'm telling you basically you need to

get that out of your system get that off

your charts because it is not how you're

going to be able to see smart money in

fact we're going to be able to use these

indicators to be

uh informed as to what the uninformed

traders are actually uh thinking so when

we talk about sentiment next month

you'll have a lot more understanding

about what that is how it's developed

and what you can do with it

now

obviously we only exposed one side of

the the paradigm here by

specifically dealing with the

speculative uninformed monies

perspective uh you're not here to really

so much learn about those individuals

because obviously no we all know that

there's a losing crowd in the

marketplace and your idea

of uh you know being a part of that

group is foolish so we're here only to

focus on what the smart money view is on

the marketplace and that begins by

understanding that there is a huge vast

enormous

new pool of liquidity coming into the

marketplace every single day

even though there's new busted accounts

all the time the statistics stated tell

us that 90 of traders lose their money

large funds are in the same category not

every fund is profitable just because

there's a lot of people that are

investing money into this fund or this

fund manager does not no way guarantee

that that fund will exist a year two

years five years from now

so we as

informed traders our perspective is to

hold the perspective of what a liquidity

provider or smart money view is on the

marketplace and they put a spotlight on

the aspects of uninformed money because

that's what makes the world go around in

the marketplace the smart money is there

to provide liquidity but they're doing

it at a exchange premium

in other words they're putting in in

trades that they're gonna most likely

come back to to either offset or

neutralize for their

interests and we'll talk more about that

as we go but for now understand that the

smart money knows in fact that there is

a large body of uninformed money out

there contrast that with what we spoke

of concerning the uninformed money's

perspective is there's a lack of an

entity out there that has a smart money

perspective on the price they don't have

an opinion or

an idea based

uh perspective that there is someone or

some entity or entities out there that

have a smart money perspective

or that the banks would actually

you know trade against

large uh firms or funds that that goes

against the grain of what a free market

is

so when we have a smart money

perspective in the marketplace we

actually use

their perspective as everybody else is

liquidity

and price is delivered to engineer

efficiency for the smart money entities

only

it's not anything outside that

so to hold the perspective of a

liquidity provider you are adopting a

smart money perspective and everybody

else

is liquidity

and the liquidity is going to be in the

form of buy stops sell stops pending

orders above and below the market highs

that are most recently

formed on your charts

once we understand that there's two

distinct perspectives that's what

creates the market efficiency paradigm

both of

both groups okay have

their individual perspectives

the one that is smart money they have

the unique perspective of understanding

already what the uninformed money is

going to believe about the marketplace

and that gives them their edge on top of

that they're actually in control of

price just like anything else if you own

a storefront or if you're owning a

business and your commodity is sold who

sets the price for that commodity you

you're the store owner well currency is

owned by the bank and they set the price

on the value of that bank note or that

digit on your screen that says you have

xyz number of dollars in or francs or

pounds or whatever it is that you're uh

you measuring your currency in

that's east that value is set by the

central bank that has printed that money

and why this is such a uh

speed bump for people's understanding

is beyond me because if you look at the

state of the world we're in right now

obviously corruption and deceit is the

name of the game so

it's not a shock to hear if you first

time being exposed to this that the

central banks are in absolute control of

what their price of their currency is

and they can set it at any time at any

price they want don't believe me look at

what they did with the swiss franc and

the euro when it was d-pegged

instantaneous wipeout okay

so once we understand both perspectives

okay intimately okay we no longer have a

at odds

perspective on the marketplace we don't

vilify the market maker we don't vilify

smart money we don't beat up or

make fun of the uninformed money in fact

what we do is we find a balance in

between that and we don't think in terms

of victim or aggressor we just think in

terms of efficiency because the markets

are always going to trade in an

efficient manner but it's slanted and

more prone

to lace the pockets of the smart money

because they have the advantage of

pricing wherever they want price to go

to and they already know what the

perspective is of the uninformed money

and they also know how to manipulate

that perspective at any given time based

on chart patterns based on indicators

based on just reactions to market news

now as we go through this mentorship

we're going to be focusing primarily on

your understanding of these four primary

drivers in price delivery it's

retracement expansion reversal and

consolidation now we're not going to

talk specifically about that but i want

you to understand that all the things

we're teaching here they're all

frameworks for you to understand those

four general principles

we can't

teach specific

contexts or

topics without having a broad based

understanding of foundation and that's

what this entire month of september is

doing it brings everybody to a reference

point to start at the same location some

of you that are advanced that watch a

lot of my free tutorials over the years

you need to put that aside for a moment

and start with this perspective in mind

and i promise you it's going to deliver

everything that you skipped over we're

going to fill in all those gaps

but understanding that the interbank

price delivery algorithm okay to

understand that it's going to have to

come by exposure and exposure creates

experience that experience is going to

give you the understanding going into

the charts seeing what they ex what they

should be doing with price what you

should be seeing in price

by seeing each individual component

explained in detail and context

each individual part or component of the

hole will be able to dovetail nicely and

you'll understand how everything fits

together but suppress that desire to

feel like you have to have techniques

and and

patterns and

intricate secrets about how the chart

does this or chart does that

you have to have the framework in mind

and the foundation of why these things

exist otherwise all those little things

ain't going to make any sense to you

when i'm calling on you to refer to them

so with all that

what specifically should you be focusing

on right now as a new student in this

mentorship

the first thing you need to know is

there are

very little things you should be

bringing into your expectations and what

your

understanding should be

in other words basically what i'm saying

is you need to have

no previous knowledge brought in with

this

kind of like put everything aside and

assume it's very difficult for those who

have already gone through

different disciplines of trading

because they have to try to forget what

they already know

and even if they've made money with it

which is the worst thing that could have

ever happened is if anything outside of

institutional order flow led to your

profitability it really was just

coincidence and coincidence can happen

for a long time i did it for nine months

and was all pure luck and then it no

longer worked again so

understanding right now what it is

specifically you're supposed to be doing

that's important as a new mentor student

the first thing you need to be doing is

creating a daily price action log with

price charts

now i know some of you don't want to do

this some of you have resisted me uh

telling you for years to do this but i'm

telling you you all are here and you've

paid for this mentorship you paid for

the understanding and expecting

experience that i've gained over the

last 23 plus years

i can tell you

how i got it was doing the very things

i'm going to tell you to do in this

specific video it starts here if you

skip this video if you skip what i'm

teaching you in this video if you ignore

what i'm telling you what to do in

regards to what specific things you

should start with right now it does not

mean okay just because you've been

trading longer than anybody else and

because you have i understand what

optimal trade entry is because you

understand what an order block bullish

embarrasses before because you

understand what a liquidity void is that

is not an advantage okay you need to go

back to square one and understand that

this is strength in your development if

you don't do these types of things

you're actually going to hurt your

development you're going to hurt and

stunt your growth throughout this

mentorship

so

go back to square one you're the new

student do everything that's been

described here and advise because this

is where the money starts coming in if

you have these things in place and you

start right at this very core principle

it will develop we're going to be

focusing on this throughout the entire

12 months every month we're going to

build on what rules and what things that

you're supposed to be looking for in the

charts but for right now primarily the

only thing i want you to be doing is

starting with a daily chart

okay your daily chart needs to show 12

months no less than nine months view you

have to have that much perspective on

your chart don't have so much of a

perspective you have multiple years on

your chart

12 months to nine months ideally

okay you have a four hour chart and your

four hour chart needs to have three

months of price action viewed

the 60 minute chart or one hour chart

has to have at least three weeks view

and the 15 minute chart needs to have at

least three to four days view that means

for every chart here i'm recommending a

specific amount of data that needs to be

displayed for that respective time frame

what you need to resist doing right now

is you need to resist the urge to

forecast price movements that's not for

your stage of development right now

do not try to rush ahead and try to

figure out what the market's going to do

next because that's going to be a

problem for you and it's only going to

lead to frustration we will get you

there and it's going to happen in due

time but for now resist that urge but

there are some things you need to be

specifically dealing with these charts

you need to note where

price shown a quick movement from a

specific level in other words if it's

run quickly higher or lower from a

particular level that's noteworthy you

need to note that on your chart you need

to also note recent highs and lows that

haven't been retested that means if a

high's formed on your chart if the price

has not come back up to that level in

recent time okay you need to make a

special note of that because it's going

to probably be influential going in the

future vice versa just contrarily

speaking you're going to be able to look

for the lows that have formed that have

not been recently traded to and that low

will be influential later on in future

price delivery as well

note areas on the charts where price has

left clean highs and clean lows

basically that looks like two equal

highs that formed in

close proximity to one another um

when we whenever we see a high go

up and form and then it trades away from

that for a little while and comes right

back to it and doesn't make a new high

or maybe it falls just a little bit

shorter just a little bit above it

i note that as a clean high and usually

buy stops will form above that and the

market will usually come back up there

and run through that

it doesn't mean it won't continue

through it but it's usually a big

bullseye for a price to want to go up

into that area and the reverse is said

for double bottoms or equal lows when a

low is formed and another low is equally

formed in close proximity to the initial

one

that's a big area for sell stops to pull

or build up underneath those lows and

the market tends to have a willingness

to go down there and test that liquidity

that means the market will go down into

that area whether it continues to go

lower or if it goes down and then

reverses there's conditions that we look

for to frame all that and you will know

when to expect the specific conditions

but for now i want you to start

practicing looking for that in your

charts and having them noted on your

chart

note what days the highs and the lows

form

and

this is for the weekly range and you

want to know what time of day that

occurs what kill zone is it the high and

low of the

week forming in london or is it forming

in new york because all those things are

going to lend well to

prognostication and what should happen

going forward

and you want to note the daily high and

the daily low every single trading day

and you want to note when the daily high

and the daily low forms for every

individual

uh trading day

now what does that look like well it

starts off with a bare bones chart this

is a daily chart and i'm using the swiss

franc here it could be any chart any

pair but you want to start with one

currency pair and then it's mentorship

you want to specifically deal with one

i would recommend you doing something

apart from the british pound and the

euro only because you're going to see me

specifically dealing with that

in this individual mentorship but you

want to be doing something with a

currency pair that is not being utilized

in this mentorship that way you're

getting a unique perspective that you

yourself have arrived at

using this as a guideline

but the first thing you want to do is

obviously note the most recent highs in

the recent lows where markets have

shown a willingness to repel from that's

the first thing you want to note because

this is how you identify order blocks

this is how you identify liquidity voids

this is all the beginning frameworks of

that but you need to be able to note

those recent highs and recent lows

that's what's been done for you here

next you're going to drop down into a

four hour chart and those same levels of

this noted on the daily chart are shown

here

and there's more highs and more lows

that come into visibility by doing a

lower time frame perspective we went

from again

the chart was a daily chart before

now we're looking at the same levels

just

drop down into a four-hour chart those

levels will be transposed immediately to

what the four-hour chart shows then you

go through doing the same thing you're

looking for areas where it's too clean

equal highs and equal lows and close

proximity to one another and you look

for where the market has moved quickly

away from a particular level when it

creates these real big candles or bars

okay on your chart you want to note that

because they're going to be influential

in your expectations of where price

should go and where they should not go

you're going to go down to an hourly

chart okay an hourly chart you're going

to be looking at

individual

days okay over a course of one or two

weeks and

you can get the weekly range

defined with the hourly chart and you

can look at the intraday highs and lows

with an hour already charge a really

good bellwether chart if you're a

short-term trader or a day trader that's

like the daily chart for uh you know the

barometer whether you should be a buyer

or seller and we'll teach all those

things all those instant details will be

taught in this mentorship for now you'll

be taking all those levels you found on

the daily chart the four hour and

transposing those to an hourly chart

now you want to keep this chart

okay in this format

separate from all the other charts that

i'm going to talk about now okay

anything else we talk about in terms of

what we're specifically looking for

they don't get utilized on the same

chart you create another chart so you're

going to have two individual independent

us swissy

charts okay but you're going to carry

the information on two separate charts

that way you don't have charts that are

too busy have too many things on there

and you get confused and all kinds of

things that we're worrying about then

you'll kind of create another swiss

franc chart okay and for that you're

going to use a 15-minute chart and when

it's loaded obviously it's going to be

naked bare nothing on there and the

15-minute chart looks like a lot of

noise it doesn't give you any

perspective without any frames of

reference and you want to take

the course of action we talked about

using the daily the four hour in

one hour chart do that same thing with

the

individual 15 minute chart but you only

need to be applying it to the last 15

i'm sorry last

three days three to four days and using

those reference points in the last three

to four days on a 15-minute chart

okay you're gonna be looking at also the

daily highs and the daily lows and you

can see this is how i do my charts on a

15-minute basis you're actually going to

see me actually do this very practice

every single day going forward starting

with this week that we're going to enter

into the mentorship

i note the previous days highs in the

previous days lows and then draw them

out to where zero gmt is which is eight

o'clock in that evening time in my time

frame and in this delivery

of data with this platform

this is how i know my daily highs and

daily lows it's important to note also

the days of the week now i'm not going

to give you all the specifics here

because you're actually going to be

watching me do it on a day-to-day basis

so you'll be able to get a rough idea

in this tutorial but more specifically

you can actually see me actually

creating documents

for my individual

record keeping so you're going to see

actually how i do my charts how i log

them and yes even after 23 years of

trading i still do this

it's important to do it it's

understanding it's clarity it gives you

perspective and it's what professionals

do sorry it's just there's no way around

it the folks that are really

concerned about the market they have

logs they keep journals these are the

types of things they do

if you notice real quick why noting the

previous day's highs in previous days

lows if you look at wednesday's data

okay

you see the little

delineation where it says wednesday if

you look at the previous day obviously

it would be tuesday in the course of a

normal week

the high that was formed on tuesday

on wednesday price came right up there

and ran through that around the 97 90

level

uh notice it did not continue through

that it just went up through the

previous days or tuesday's high

then it sold off

when it sold off

it went all the way down where did it go

down to just any old level it went down

to tuesday's low just breaching it by a

pip or two and then came back off into

consolidation

then look at what happened on thursday

thursday we had price retraced back into

the range that was created from

wednesday's high down into wednesday's

low

thursday starts today with trading and

consolidation it rallies up closes in a

range

okay that was formed from wednesday's

high and wednesday's low then it sells

off and where does it sell off to

moving just below

then it pulls off that low and goes into

consolidation

then we have friday

the market just goes straight on up

rolls right on through

thursday's high

and creating a new high prior to friday

the weekly high was formed on wednesday

it ran out the stops and all the

liquidity that would be resting above

wednesday's high

all done on friday so we're going to be

using these reference points and giving

you a lot more insight

about specifics and what you're doing

with it but for now i want you to know

that this is what you're going to be

doing

going forward every single trading day

you're going to document price action

you're going to build on your

understanding

every month i give you more reference

points to add to your charts and why

it's important what specific what the

information will do for you what uh

with advantages it gives to you by

having it and

by having your charts very uniformly

organized like this

when you're trading

your chart is going to have its

independent uh analysis you're not going

to have all these things on your chart

but these charts are always going to be

referred to while you're watching price

because

by having three charts okay because

you're gonna have one that's executable

in other words what you're watching on

the setup right now because you never

want to marry the ideas that you have in

your analysis you need to reflect on

them but you don't want to be so cast

iron can't do it any other way it has to

be that way otherwise if you're watching

real-time price action if you see

something that doesn't make sense for

what the underlying conditions that

you're expecting occurs in the

marketplace

you won't have the flexibility to switch

gears or go to the sidelines you'll just

hold on to the market with strong

conviction and that that's imposing your

will that the market's going to do what

they're going to do and it's not going

to happen because you want it to happen

it's going to happen because it's going

to happen and we try to get in sync with

what the market's going to do whether

it's going to be moving sideways whether

it's going to go higher whether it's

going to lower we don't know any of

those uh directions with a great deal

of certainty we just know probabilities

and but we know how to go into the

marketplace looking for these types of

things over and over and over again they

repeat and you'll be able to find those

repeating

uh occurrences in price action after

going through this mentorship