Everything you need to know about a Sharp Turn (ST)

Summary

This trading strategy leverages sharp turns and fair value gaps (FVGs) to identify potential entry points for upward price movement. By analyzing FVGs on multiple timeframes, traders can spot areas of market manipulation that signal a continuation in price direction. The strategy uses the interplay of daily and hourly FVGs, with the sharp turn confirming the entry. This counterintuitive approach taps into market imbalances and the manipulation of traders, making it a key technique for predicting higher market movements.

Takeaways

• 😀 Sharp turns in trading are used as potential entries for trades.
• 😀 The daily fair value gap (V gap) is an important factor when considering market continuation.
• 😀 On the 1-hour chart, identifying a fair value gap at the daily level is crucial for predicting price movements.
• 😀 Momentum going against your entry can be counterintuitive, but it is often the signal you want in trading.
• 😀 Fair value gaps can act as manipulation zones, trapping traders before price moves in the intended direction.
• 😀 A fair value gap low can indicate a manipulation zone, setting up a sharp turn in price action.
• 😀 The formation of a fair value gap and its subsequent fill is a common pattern in market reversals.
• 😀 A sharp turn confirms that the market is likely to continue in the higher direction after a manipulation phase.
• 😀 Fair value gaps do not need to overlap but can still create strong price movements when combined with sharp turns.
• 😀 The key to understanding sharp turns is to focus on the manipulation of price through fair value gaps.

Q & A

What is the main concept introduced in this script?

The script focuses on the idea of sharp turns in trading, using fair value gaps as entry and exit points for potential trades. It explains how these gaps can signal manipulation and provide opportunities to continue higher in the market.

What is a sharp turn in the context of this script?

A sharp turn refers to a price movement in the market where the direction changes abruptly, often following the filling of a fair value gap. This change in direction can confirm a continuation in price, particularly when combined with other technical factors.

What is the significance of the daily fair value gap in this strategy?

The daily fair value gap is a key area where price may continue higher. It acts as a potential entry point, signaling that price may move up after filling or reacting to the gap.

Why is it important to observe the 1-hour fair value gap in this strategy?

The 1-hour fair value gap is critical because it provides a shorter-term confirmation of the price movement towards the daily fair value gap. This gap can show where price might reverse or continue based on smaller time frame behavior.

How does momentum play a role in the decision-making process described?

Momentum is often going against the entry, which might seem counterintuitive, but it's actually desired in this strategy. This creates the conditions for manipulation, where traders are trapped, setting the stage for the market to reverse or continue higher.

What role do fair value gaps play in market manipulation according to the script?

Fair value gaps are used to trap traders. When a gap is created, the market can manipulate price action to create false moves, leading traders into poor positions before moving the price in the intended direction.

What does it mean when the script refers to a 'fair value gap low'?

A 'fair value gap low' refers to the lower boundary of the fair value gap. When this level is reached, it could potentially trap traders, leading to a reversal or continuation in price that aligns with the trader's entry strategy.

What does the 'sharp turn' confirm in this strategy?

The sharp turn confirms that the price movement is likely to continue higher. It indicates that the market has reacted to the fair value gap and is now in the phase of moving in the desired direction.

Can the fair value gaps overlap with each other, and does it matter?

No, the fair value gaps do not need to overlap with one another. The key is that they occur in the right sequence and contribute to the overall market manipulation, leading to the sharp turn that confirms the trade direction.

Why is a fair value gap higher important in this context?

The higher fair value gap marks a significant area where the price might continue upward after the sharp turn. It aligns with the strategy's goal of identifying manipulation and confirming price continuation in a higher direction.