FVGs Don’t Work Unless You Use THIS - Ep. 14
Summary
TLDRThe video analyzes the key differences between winning and losing trades, explaining that the underlying factor is time and volatility. It outlines how economic news events create market volatility on higher timeframes, while session open/close times drive volatility on lower timeframes. Checking the economic calendar and planning trades around major news events can improve probabilities. It also covers trading session guidelines - when volatility typically occurs for indices vs forex. Ultimately, time must agree with price for a trade setup to have a higher probability of playing out successfully.
Takeaways
- 😊 The key difference between a winning and losing trade is the presence of time/volatility to move price. Without energy/volatility, price will not move to take profit.
- 📈 Higher time frame volatility comes from high impact news events like CPI, FOMC, NFP. Avoid trading the day before/of, but fine afterwards.
- ⏰ Lower time frame volatility comes from sessions - 9:30-4pm for indices, 2-10am for forex. Lunch time dips still tradable if setup is valid.
- 📰 Other red folder USD news besides big 3 can be traded before/during/after the news release.
- 😎 Winning trades need agreement between time and price - time brings volatility for price to move. Reliable volatility makes strategy profitable.
- 📊 Trading revolves around probabilities. Clean setups can play out without news, but trading with news has higher probability.
- 📉 Losing trades happen when time disagrees with price - no energy for price to continue direction.
- 🗓 You can trade crosses like AUD/CAD if no suitable USD news for the day.
- ☝ Asia session still tradable for Asia pairs like AUD/USD and NZD/USD.
- 🎯 Time is the differentiator between winning and losing setups that otherwise look similar in terms of price action.
Q & A
What is the underlying factor that makes a winning trade versus a losing trade?
-The underlying factor is time and volatility. Winning trades have volatility and energy from news events, economic calendar releases etc. to push the price towards take profit. Losing trades lack this energy and volatility to sustain the move.
What are the big three news events to avoid trading around?
-The big three news events to avoid are: CPI, FOMC meeting minutes, and Nonfarm Payrolls (NFP). It's best to avoid trading the day before and the day of these events.
Can you trade other USD news events besides the big three?
-Yes, you can trade other USD red folder news events like PPI, Consumer Sentiment etc. before, during and after the releases. Only the big three require avoiding the surrounding days.
What brings volatility to the lower timeframe?
-Kill zones, which are essentially volatility sessions, bring energy to the lower timeframes. For indices, the main kill zone is the 9:30 AM - 4:00 PM New York session. For forex, volatility comes more from economic news versus sessions.
Why do some fair value gaps hold while others do not?
-Fair value gaps hold when time and volatility aligns with the gap. If volatility dries up, gaps are likely to fail even if price action looks similar across gaps.
Can you trade forex pairs during the Asia session range?
-The Asia session is usually seen as a low volatility consolidation period. However, Asia-centric pairs like AUD/USD and NZD/USD can be actively traded.
What is the launch time in forex and is it tradable?
-The launch time is 5 AM - 7 AM NY time. It can be traded if volatility and momentum supports the price direction despite being between two sessions.
Why is trading based on probabilities and not certainties?
-No setup or trigger will have 100% accuracy. Trading is probabilistic with certain conditions skewing the odds favorably but not guaranteeing an outcome. Risk management is key.
How can you call price action live with a high accuracy?
-Through practice and having a trading strategy that incorporates the key elements covered - higher timeframe context, volatility, kill zones etc. But accuracy will still involve probabilities.
What discount and premium rates refer to in trading?
-Discount rate refers to periods of decreased volatility and ranges where price may be cheaper to enter. Premium rate refers to higher volatility directional moves where price is extended.
Outlines
😀 Difference between Winning and Losing Trades
The paragraph discusses that there is an underlying factor that differentiates winning and losing trades despite their similar price action. This factor relates to time and volatility that makes the market move to hit take profit. There are two types of time - higher timeframe news events like economic calendar and lower timeframe sessions that bring energy and volatility.
📆 Higher Timeframe Analysis with Economic Calendar
The paragraph explains how to analyze the higher timeframe using the economic calendar. It states that major news events like CPI, FOMC and NFP have a one-day spread to avoid consolidating price action. Other red folder USD news besides the Big 3 are tradable before, during and after. Examples are shown of losing and winning trades based on supporting/lack of USD news.
⏰ Rules for Trading Around Big 3 News Events
The paragraph provides rules around trading major news events. It states to avoid trading the day before and day of CPI, FOMC and NFP due to extreme volatility. The day after is fine to trade. For other USD news, trade before, during and after. Crosses can also be traded when no USD news. Checklist summarizes rules.
📈 Lower Timeframe Analysis with Kill Zones
The paragraph distinguishes lower timeframe analysis using kill zones. For indices, trade between 9:30-4 pm NY time on equity open volatility. In forex, volatility comes more from news, not kill zones. Forex kill sessions are provided - London, NY, London close, Asia. Rules specified for trading each session.
⏩ Next Steps and Invitation to Masterclass
The paragraph concludes time is the differentiator, not price action. It invites interested viewers to enroll in the limited-seat masterclass opening March 1st to learn live trade calling, directing them to social media for more details.
Mindmap
Keywords
💡Fair value gap
💡Entry confirmation
💡Order block
💡Take profit
💡Stop loss
💡Risk reward (RR)
💡Economic calendar
💡Higher time frame
💡Lower time frame
💡Kill zone
Highlights
The underlying factor that makes a winning trade is time and volatility, which provides the market energy and movement.
Volatility comes from news events on the economic calendar, specifically US dollar red folder news like CPI, FOMC, and NFP.
Avoid trading the day before and day of CPI, FOMC, and NFP due to increased consolidation and volatility.
It's fine to trade the day after CPI, FOMC, NFP and other red folder USD news events.
Besides the big 3 news events, other USD red folder news brings volatility for potential trade setups.
Trade cross pairs like AUD/USD or NZD/USD when no USD news is upcoming.
For indices, focus trading between 9:30AM-4PM New York time when equities open brings volatility.
Indices rely less on USD news and more on equity open times for volatility unlike forex.
Lunch times in forex often still see volatility if price is already trending strongly.
Asia pairs like AUD/USD and USD/JPY are fine to trade during the Asia session.
Fair value gaps hold when time (news and sessions) agrees for continued price movement.
Price patterns alone don't determine if a trade will succeed - time is the differentiator.
Being able to predict price action comes from understanding time and volatility.
Focus is on when to trade based on higher and lower timeframe time analysis.
Understand when time provides the energy and probability for your trade setups.
Transcripts
can you see the difference between this
winning trade right here and this losing
trade right here probably not right and
that's exactly my point because there is
no difference when we look at Price
action overall it's very similar it's
almost the same and here it is not about
price so what makes the winning trade a
winning trade there's an underlying
factor that is extremely important to
understand to increase your win rate and
to increase your overall profit
and that underlying factor is exactly
what we are going to go over today so
first steps first what is that
underlying Factor what am I talking
about well here on this losing trade we
see this gray box which is fair value
Gap we have fair value gaps going higher
right there we have some type of an
entry confirmation right there entry on
the order block and on the fair value
gaps itself why do those fair value gaps
not hold and ultimately why is this a
losing trade when in comparison to this
very similar price action we again the
gray box is fair value Gap after that we
have fair value gaps higher fair value
gaps higher again the entry confirmation
entry of the order block right there why
does this gray box that fa value Gap
actually hold whilst price action is
almost the same and of course I
understand yes there are slight
differences in price action but that's
not the most important part because
there's always going to be a slight
difference in price action and price
here in the winning trade and losing
trades they are always going to show you
something there's always going to be
some kind of setup some kind of trade ID
every single day but what makes a trade
a winning trade well in order for this
trade right here to hit take profit what
does it need to do it needs to move
higher to hit take profit and I know
that sounds extremely stupid but think
about it if price doesn't move then your
trade will never hit take profit Prof it
it will always be closer to my actual
stop loss right there so then the
question becomes well why does the
market actually move and the market
moves because of time but not the fancy
word time that most Traders think about
no we are actually going to dissect this
fully time is often times used as a
marketing word it's a buzz word whilst
it doesn't have to be that difficult
because time is simply said volatility
and volatility makes the market move and
even volatility to me is always a liit
of a vague word it's not that clear what
it actually means where I like to refer
to it as energy when you have energy for
example most likely you would want to
move you want to do something right and
the opposite is also true when you don't
have a lot of energy what do you want to
do you probably want to sit down want to
sit on the couch want to sleep a little
bit that's why we go to bed in the first
place because we're tired we don't have
energy so when we have energy we like to
move when we don't have energy we don't
like to move that's the same exact thing
in the market so what then brings that
energy to the market well there's two
types there is higher time frame time
and lower time frame time we first need
to go over the higher time frame time
higher time frame time is when we want
to know if a day is actually ready to
continue higher or continue lower so if
the day itself will actually have good
movement and if the day itself will
actually have high probability of
showing this trade for example a winning
trade and that is done through news the
economic calendar the economic calendar
makes the market move makes the higher
time frame move which of course then
hand inand makes the lower time frame
move as well the lower time frame is
what we're going to go over later on in
this video now to make it easy I want to
focus on the economic calendar for the
US dollar I am by the way using Forex
Factor no affiliation or whatsoever this
has always been my go-to economic cender
the most reliable in my opinion then if
we take a look at this losing trade that
we had we had this 1 hour for Val Gap
right there then going into the one
minute we again saw one minute fors
going higher absolutely perfect new one
minute for up going higher there as well
which in itself again could be a great
entry But ultimately why did this 1 hour
F Gap right there not hold why did it
not push higher right there for us to
hit take profit well look at this day
right here which is by way a Sunday 18th
of February we're going to count this as
a Monday so Sunday to Monday where both
of those days we don't have any news
besides US Dollar Bank holiday here
we're trying to trade Euro US dollar so
ideally we want some US dollar news and
which exact news is exactly what we're
going to go over well if we look at the
winning trade we have this 4our forup
right there that actually helped that
pushed prize higher right there which on
the five minute had a beautiful
confirmation to actually push higher and
make the winning trade possible why is
this well looking at the economic
calendar again and if we go to the
previous week then on the previous week
right here we see this winning trade was
taken during Friday the 16th of February
Friday the 16th of February we had core
PPI and we had prelim consumer sentiment
right there two red folder us dollar
news and that is the exact difference
but just trading rap folder News will
not do it because that will also cause
you to lose a lot of trads because
there's something called The Big Three
and the big three is US dollar CPI fomc
and
NFP those three news events have a onday
spread what do I mean by that well here
for example on this last week we see CPI
core CPI for the US dollar whenever you
have a big three news event so again CPI
fomc and NFP you want to avoid the day
before right there because even though
we have US dollar orange Fuller news
that means nothing the chances of
consolidating are increased right there
why is that because the big three takes
up so much volatility that ahead of that
price action we are more likely to
consolidate and then afterwards we will
explode towards one side or first take
out one side to then move to the other
side to avoid Traders from being a part
of that move to then make the real move
this happens the day before CPI and also
we see 8:30 so the 8 hours and 30
minutes before CPI as well after that
news release it is perfectly fine to
trade when it then comes into your PD
Ray then shows your entry pattern for
example like we see right here on this
EU trade on that Friday we see PPI PPI
right there was just the C Catalyst for
this setup why we were always expecting
to move higher from this 4our Vaga which
we even mentioned in the previous video
live then before we even hit the 4our V
Gap there is no reason to go into the
lower time frame just yet to look for
our entry confirmation so once we hit
that 4our Gap then we can go into the 5
minutes and when we are in the 5 minutes
then PPI right here this huge candle
that 830 candle is where the volatility
again comes in and that is simply said
where eventually the entry presents
itself because the time and the fair
value right there are in agreement but
then right here we also have at 10 a.m.
right there we had that US dollar
consumer sentiment that we saw is that
tradable yes everything besides the big
three can be traded before during and
after and the reason for that is again
big three CPI fomc and NFP are so
extremely volatile that in live
conditions not demo conditions like your
your favorite Guru might show you nfb
profits but actually life conditions if
that goes against you and it moves
against you it does not fill you at your
stop loss it fills you way below that
because in that small time period there
is no one trading brokers deactivate
trading during that actual period they
are not obligated in any shape or form
to fill your stop loss at that moment in
time during those heavy news events so
if your stop- loss gets hit then it
doesn't get hit and you get filled way
below that so for example here if we
were to trade this during actual CPI and
we enter on the exact moment CPI happens
and where to come to our stop loss if
for example we took a short right there
then we would not get filled right there
yes if you're trading demo absolutely
you might but live conditions you might
get filled right there losing double
triple four four times five times the
amount you actually risked so then you
are essentially trading in negative RR
conditions meaning that's not risk
management that's not trading that's
just purely gambling why is it gambling
well if there's no risk management
involved then right there in order to
avoid blowing your account you would
need to have a 100% win rate or even
close to 100% win rate to pull this off
no one is going to have a 100% win rate
absolutely nobody if they're telling you
you they have 100% win rate it's
absolutely so even if you lose
that one time and that one time might
blow your account even then you are
unprofitable might as well go to casino
and put everything on red constantly so
we don't want to trade ahead of that CPI
and ahead of that F fomc and ahead of
that NFP but after it how does that work
well again like we show right after CPI
fomc nfb is perfect fine to execute 100%
and the one day spread we talked about
where you want to avoid the day ahead of
it you can perfectly find trade the day
after it so even though on that
Wednesday we do not have red folder US
dollar news it is perfectly fine to
trade that day the Thursday also
perfectly fine to trade Friday Also
perfectly fine to trade then if we look
at the next week and we just go over
multiple weeks to ingrain this into your
mind Monday right here do you want to
trade no Tuesday do you want to trade no
also because it doesn't have US dollar
redf news but more importantly because
it has fomc the next day so avoid
Tuesday then also avoid Wednesday until
after fomc then right here Thursday is
perfectly fine tradable Friday is it
tradable no Friday we don't have red
fold news so I want to avoid it so
before I give you the full checklist
right there to go over so that you fully
understand this it's important to
understand again these are all
probabilities right so will you have
clean setups and nice trades that play
out when we don't have news supporting
the ID right there yes 100% you will if
during that 10day period you were to
take one trade each single day let's say
you lose eight out of those 10 days and
you win two of those 10 days you would
need to catch nine RR combined over
those two winning days to actually be
profitable whilst if we look at the
higher probability thing when we do have
news supporting the ID let's say five
out of 10 days are now clean and that's
again taking it very easy not
overexaggerating taking very easy let's
say five out of 10 days five winning
days five losing days you would need a
combined six RR in a total of five days
to be profitable well that's a lot
easier right it's a lot easier to do so
seeing people say well this day had no
new sporing the ID right there but it
still had beautiful trades yes you don't
understand how trading actually works
which is again it's all based on
probabilities now the checklist you want
to go over for your higher time frame
time before we move into the lower time
frame time the big three is what you
want to avoid the day before and the day
itself the time before that after that
it's perfectly fine to trade the day
after no matter what it's also perfectly
fine to trade besides the big three if
we have red folder US dollar news like
we're seeing on this Thursday right
there that is perfectly fine to trade
that perfectly fine to execute before
during or after that news release and
when I refer to fomc I refer to fomc
meeting minutes right there when I refer
to CPI I refer to CPI right there US
dollar and when I refer to NFP I refer
to nonfarm employment change right there
and then your question might be well
arel in a week like this do you then
just don't trade like what do you do
well of course there are multiple pairs
out there besides the US dollar which
are also called the crosses so if we
take a look at the list right here on
the right side of our screen and the
Forex Majors right there is something I
would avoid until we have had the big
three news event which is the fomc
meeting minutes but if we move to the
crosses which is this list for example
we have Australian dollar news we have
canadi Ian dollar news GBP news Euro
News a bit of New Zealand dollar news so
Australian dollar Canadian dollar
Australian dollar CHF GBP Australian
dollar for example are all perfectly
fine tradeable because that is where the
volatility is going to be so higher time
frame checked off right there lower time
frame we can reveal that right now
because now we need to understand the
following things what brings the
volatility to the lower time frame that
is where kill zones now come in or
another word a fancy name for sessions
so for example if we want to understand
if a fair value Gap is actually going to
hold right there then the fair value Gap
itself like we saw on the higher time
frame time is not enough we also need to
understand if time is agreeing with
price if time is agreeing for that F Gap
to actually hold where right here we see
this F Gap does not actually hold
because we come below this swing low
right there before we actually continue
higher so why does that fair Val Gap
right there not hold for indices and
here we are on NASDAQ currently it's
important to understand the following
Kill Zone focus on your trades between
9:30 a.m. and 400 p.m. New York local
time lunch times all that stuff doesn't
really matter and I'll explain to you
why so right here if we want to wait for
that 9:30 open again for that 9:30 Kill
Zone to start then right here we see at
9:30 that's exactly where the volatility
comes in time often tells you whatever
price wants to do meaning once time is
sort of activated time right there comes
into the market we have equities open
for example like we have right there at
9:30 that stinks into a discount array
into a 1H Hour Discount array in the
form of That Swing Low that then shows
our entry pattern in the form of that 5
minutes for higher so then we have time
and price in agreement where it is that
simple trust me it is that simple right
there where time telling you what it
wants to do because simply said it
stinks into your PD shows the entry
pattern that's it where that entry is
perfectly fine but this entry again why
does this entry lose right there we
don't have time supporting the ID now
for indices it's also important to
understand it's less reliable on US
dollar red folder News why is that
because the indices are already
extremely volatile with equities open so
every equities open which is again 9:30
that's the start of the Kill Zone until
400 p.m. that is already extremely
volatile by itself where in Forex it's
the opposite because in Forex you are
almost reliable on those US dollar red
folder News kill zones in Forex and I
might get a lot of comments towards my
head but for my experience it's very
true and from the data as well in my
trading it is very true kill zones in
Forex are less relevant than ind's kill
zones and again I'll explain why because
kill zones in Forex just generally don't
bring in the amount of volatility in
comparison to an equi open where the
volatility for Forex truly comes from
that economic cender not So Much from
the kill zones where the kill zones in
general for Forex right here is you have
London open London open is from 2:00
a.m. to 5:00 a.m. New York local time
again everything I mentioned is New York
local time
after that you have 7 a.m. towards 10:00
a.m. New York open or the New York Kill
Zone then from 10: to 12 you have London
close and then from 8 until 12 again so
making the full circle is where you now
have the Asia range but there's a lot of
factors going into this then what about
the period between 5:00 a.m. and 7:00
a.m. because that is known as the launch
time can we execute during the time for
your Forex Pairs and for your Forex
Majors so the I have on the right right
there it is perfectly fine to execute
between 2: to 10: a.m. because let's say
price is moving higher right here it is
having a PD in the form of that fair
value Gap right there and we have launch
time which is actually true at that
moment time we have 6:00 a.m. right
there and 65 until 7:00 a.m. but we can
see this lunch time is more volatile
than whatever London open was doing
right there why is that well that simply
is because because price there is ready
to continue higher and what do I mean
with that it's again showing the
discount rate showing the entry pattern
so it's willing to continue hire if you
are about to have lunch and you are in
the middle of a project and you're about
to finish it I think nine out of 10
humans it's sort of this human nature
that you want to finish the task first
before you go to lunch it's just a
better feeling that's the same in the
market why would anyone go to lunch
right there if it has a jum to fulfill
meaning moving from the discount rate
towards the premium rate right there and
2 until 10:00 a.m. in general is true
but what about the Asia range the Asia
range is not a range if it's an Asia
pair from 8:00 p.m. until 12 a.m. it's
called the Asia range and Asia range is
where usually it is taught that it's a
range it's a consolidation you want to
avoid that price action right there but
again that is also extremely General
because if we look at Australian dollar
US dollar that's actually very active
during the Asia range so during Asia
it's perfectly fine to execute on
Australian dollar US dollar the same
goes for New Zealand dollar US dollar
the same goes for US dollar JPY what do
they have in general Asia pairs JPY New
Zealand dollar and Australian dollar for
those pairs it's perfectly fine to
execute during Asia as well so why does
this gray box right there hold why has
this fair value Gap right there held as
well pushing price higher why are these
fair value gaps and every fair value Gap
that we see after right there not hold
as in has not created a new fa value Gap
off of that and has not been respected
time it's not because of price itself it
is because of time so if you've watched
the previous episodes of Mark Mastery
everything I told you right there and
every concept we have gone over is all
invalid for me if time is not supporting
the ID price is always going to show you
something time is the differentiator now
if you are interested in a shortcut and
you are willing to learn how to be able
to call this price action live like we
have been consistently doing then again
the spring enrollment the first of March
is opening up for the master class
limited spots available not everyone
will be able to get in you can apply and
after that you will also still have a
chance to get in so please if you are
interested in that pay close attention
to my social media when 1 of March is
approaching as well and if you don't
believe my word then again you can go to
ar. where you will see other people say
the exact same thing where again the
results are also speaking for itself all
right perfect thank you
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