Immediate Rebalance & Institutional Order Flow

Date: 2023-05-25

URL: https://youtu.be/ZtLMTXv-Dr0?si=CgyPMgKBmFpTDzBw Watched Date: May 26, 2023

Here we have the weekly chart of the Dollar Index. If you’ve been keeping notes, we have pretty much been calling this day by day. You may have missed how it has been performing as we’ve been outlining it each day, so I want to bring that to your attention.

Many times, people get caught up in the “Netflix and chill” aspect of ICT’s plethora of videos. But it is important to take notes. Write down what we are anticipating and what we are looking for. Then you can go into your charts — even if it’s only for backtesting purposes — and see what you should be gleaning from the lectures and price action.

So, on the weekly chart of the Dollar Index, you can see that we traded up into more of this up-close candle here. Initially, I drew your attention to the opening price, which we hit yesterday. Then I said we would likely see continuation to the upside and further weakness on EUR/USD, and that is exactly what transpired today.

The next level on this up-close candle is the mean threshold. Mean threshold is the halfway point from the high to the low. That halfway point is here, and that level comes in at 104.540. That is the level you should have on your chart. If we see continuation to the upside, that is the level I’m looking for.

I also mentioned how we would use this imbalance — from this candle’s low to this candle’s high — as support to spring price higher. And we saw that happen here.

No Wyckoff required.

Alright, daily chart here on the Dollar Index. Again, here is that weekly order block. The opening price is what that level was. It becomes harder to discern once we drop into a lower timeframe, so if I were to show you only this chart with no reference from the weekly chart, it would be a little confusing as to why I’m anchored right there.

We hit that level yesterday. Then I mentioned that we had this imbalance in here, and we also had a daily order block. That is this level here — the big up-close candle right there in this timeframe.

Now let me go back one more time. See how we identified this up-close candle prior to the rotation lower? We are now applying that same logic to the daily chart: the last up-close candle here, specifically the highest up-close candle. That opening price is being annotated, and you can see that we hit it today, just outside the scope of this imbalance here.

So the Dollar is a little bit overzealous, and we’ll see whether it wants to reach up to the 104.540 level I mentioned yesterday.

The idea is this: when a candle opens, trades down to a previous day’s high, and does not offer any opportunity for a deferred inefficiency — which is what a fair value gap is — I call that an immediate rebalance. A fair value gap forms because the market moves away too quickly and leaves an inefficiency by way of an imbalance in price.

Since these candles are moving higher, the imbalance is buy-side. So it is a buy-side imbalance / sell-side inefficiency. In other words, it is inefficient in offering downside delivery or downside movement.

Price rotation, on a liquidity-continuum basis, means price is efficiently delivered between a defined range of price action. For instance, if we look at the range between 103.400 and 103.200, that’s 20 pips. Price has moved up, down, up, down inside that range between 103.400 and 103.200 multiple times. Notice that.

So if price has already been moving back and forth within that defined range, and then we determine a bias — which is what I’m sharing with you, using my 30 years of experience to tell you where I believed price was likely to go, and then higher still — then if we get an opening on a candle and it drops down to a previous high, that matters.

Normally, if price had stopped short — for example, if the low had been up here and did not trade all the way down to Monday’s high — that would create a typical deferred inefficiency. Meaning, it would follow the normal fair value gap protocol.

This is a weekly inversion fair value gap. It is formed between this candle’s high and this candle’s low, with one candle delivering to the downside between those two price points. Price only moved down through that range, so yes, it is a fair value gap — but more specifically, it is a SIBI: sell-side imbalance / buy-side inefficiency.

So what does it need in order to become efficiently balanced? It needs upside delivery. That happens on this candle here.

Then we opened into this weekly candle, and during this weekly candle’s formation, I mentioned that we would use this level as an inversion fair value gap. If you were only casually watching my videos, you might think, “Okay, if price trades up here, he probably expects it to go down.” No. That is why understanding the narrative is so important.

That is mentoring. You only get that from spending time with me — not by watching a few videos, and not by watching someone else try to paraphrase what I said incompletely. You can’t learn it that way. You need repeated exposure over time, seeing it again and again.

But you also need the narrative, because the narrative gives you the bias. The bias gives you the context. The context gives you the framework for a trade. Without those steps, in that order, you will not find high-probability trades. You’ll be lost in the charts and frustrated.

So let’s go back down to the daily chart.

I mentioned yesterday that if we see this formation, this is what I call an immediate rebalance.

So price opened here, then traded down to a previous day’s high. That does not necessarily mean the previous day immediately to the left, or yesterday’s high. We are always referring to the essence of inefficiency and redelivery. Fair value gaps highlight those inefficiencies and the opportunity for redelivery.

For instance, look at this candle here. We have this candle’s high and this candle’s low, so there is a fair value gap. Price trades down, but it does not go all the way back down to that high. Notice that. That’s fine. To me, that is a breakaway gap. I’ll talk a little more about breakaway gaps in this lecture.

This candle opens, trades down, and goes right to this candle’s high, which is Monday’s high. So it gives no room or opportunity for an inefficiency to exist.

Why would that happen?

If we are bullish and the market is expected to go higher, and it creates this type of formation, you want to write this in your journal: this is one of the most powerful signatures for immediate dynamic price delivery.

I said this to you yesterday. If you’ve watched any of my older videos, and if you’ve been with me for a long time as a student, you’ve heard me refer to an immediate rebalance. That is one of the strongest algorithmic price delivery signatures you’re going to see.

Look at the price delivery here on the Dollar — fast and snappy.

Go back two days ago. In Tuesday’s analysis, I stated that I expected price to go up to this level here. Then on Wednesday, price delivered right to it and closed there. But on Tuesday, I also mentioned that I was not certain it would go above this fair value gap. So that gave you context: price was likely to go to that level and then stop, not offer much more.

The fact that we opened, traded down, and then rallied to that point — and then reviewed it last night — gave me the context to say we would likely continue higher on the Dollar and lower on EUR/USD.

So it is still a risk-off scenario, meaning the Dollar goes higher.

Typically, that is a risk-off scenario. Foreign currencies should decline in sympathy with a stronger Dollar.

The fact that we had this immediate rebalance, while we were bullish and looking for higher prices, allows us to frame directional bias as bullish for the Dollar. So we can be buyers of the Dollar and short sellers of foreign currencies.

All right, here is EUR/USD. This is our weekly chart, and you can see that we have expanded a little bit further. That weekly order block’s opening price is the level I have marked here.

I still think that is a likely draw — or at least where I believe price may draw down to. Everything was reversed in last night’s analysis.

As we mentioned on the Dollar Index, we had an immediate rebalance, which is bullish for the Dollar. We had that same development here on EUR/USD, but in reverse. Yesterday, we opened, traded up to Monday’s low, and then accelerated to the downside.

I drew your attention to this area right here and said, “See these two relatively equal lows? There is sell-side liquidity resting right below them. Watch that. I believe price is going to draw down to that.”

And lo and behold, look at that — look how cherry-picked and lucky that was. Price traded right down into it and pulled off that low. So the relatively equal lows, the sell-side liquidity here, were tapped into this inefficiency.

This is a fair value gap between this candle’s low and this candle’s high. So this one candle, between these two reference points here, only offered buy-side delivery. Because price moved up, in order to efficiently reprice and balance this inefficiency, price needs to trade down into it, through it, or go back up and leave the area after offering a down candle through that same shaded orange range.

The blue line is the weekly order block opening price. So I’m expecting — let’s say it that way — a likely continuation down into this area here. Because we’re heading into a holiday weekend, it may not deliver tomorrow. It may need to do so next week. But I’m sticking with the bias of higher Dollar and weaker EUR/USD.

So here is that line from those two daily candles I mentioned. They formed relatively equal lows, with sell-side liquidity — meaning sell stops — resting below them. You can see that price did, in fact, dip down into that area.

Now, last night when we were discussing this…

During our discussion, I mentioned that sell-side liquidity was resting below here. We would look to see whether price draws down into those relatively equal lows and into that shaded area, which is the fair value gap, along with the order block from the weekly chart.

So essentially, we are looking for that 1.07 big figure, or somewhere around that area.

Now, if we were not to get that at all — let’s say the Dollar topped out here and EUR/USD reversed higher — would this be a failed analysis? No. Why? Because it still offered the opportunity to see a run from where we were last night. I said we would likely go lower, but that price would probably go higher first into a short-term premium, and then drop lower.

Listen to the recordings. Every single time I do a video, you want to write down what my expectations are.

What am I expecting? What am I looking for? What would I see as a potential scenario?

Sometimes, if I’m unsure or unclear, I’ll be honest and tell you, “I’m not sure. I need more information.” But then I might say, “gun to my head.” If I ever say “gun to my head,” I’m telling you what I think based on what price is showing me in the chart.

Unless I say that and clearly state what I suspect is going to happen, that is my hard-and-fast expectation — what I genuinely believe when I sit down in front of the charts based on the logic I’m sharing with you. That does not mean you should go out there and bet the farm on it. You are learning how to read price action. That is why you are here.

And you’re going to see consistency. You’ve seen it all week so far, and this has been a really crappy week. So take from it what you can. Glean the information and understanding by spending time with me, but also pay attention to what we are anticipating in terms of direction and where price is reaching for.

That is the first skill set. That is the first thing you need to set your mind to as a student with me. And even if you are already a profitable trader using something else, if I can help you develop that skill, your trading will improve drastically. It will increase your ability to read price action far beyond any expectation you may have ever had.

So here is the 15-minute timeframe on EUR/USD, and here is the imbalance.

I mentioned that we would likely trade up into a short-term premium. Price went right up into the inefficiency one more time, then broke lower. From there, it worked down into the eventual relatively equal lows from the daily chart, dug into that area twice, and then consolidated into the close.

Alright, now we’re going to look at the five-minute chart. I’ve brought in this candle here, which is the midnight candle — midnight New York time — and I’ve extended its opening price through price action to around 11:00 in the morning.

If we’re bearish, anytime price returns back to the midnight opening price and we have not yet met our objective, that is important.

What was our objective last night? The first objective was those relatively equal lows. Then we had that fair value gap outside the range I’m showing on this chart, essentially around the 1.0705 level down toward the 1.0700 big figure.

At this time here, during the London session, price ran up and took out these relatively equal highs. See that? It ran above them and took out buy stops. Why would that be advantageous? Because smart money can use those buy stops as the counterparty to their shorts. The market then drops lower and falls just short of those relatively equal lows, which is this line here at 1.07132.

Then it leaves a fair value gap here, along with a bearish order block. The market trades back up just before 5:00 a.m., then drops back down. This is the order block — the down-close candle. Then price rallies once more, takes out this short-term high here, falls just short of hitting that order block, and trades right into the gap between this candle’s high and that candle’s low. It trades right into it, then drops one more time.

Where does it drop to? Just below these short-term relatively equal lows here.

Then what does it do during the 7:00 a.m. New York session? It rallies all the way back up for a third time after London lunch. Then, during the 8:30 window, when the news driver comes out and the news embargo lifts, price runs one more time, hits the order block from the buy-stop run, and trades once again above the New York midnight opening price.

For my Power of Three concept, I teach that the midnight opening price is important. If we are bullish, the best buys — the optimal long entries — will be below that midnight opening price. If we are bearish, and you knew I was bearish on EUR/USD yesterday and over the last few days, the best shorts are going to occur at or above the midnight opening price in New York time.

So you need to have your TradingView charts set to New York local time. Right now, because we are under daylight saving time, that will be UTC-4. That candle right there gives you the midnight opening price.

We are in Power of Three. We are hitting the order block. We are wiping out buy-side. And we are trading above the New York midnight opening price while sell-side is resting below those relatively equal lows on the daily chart, which we mentioned last night as an objective.

Price is drawing down into that level. It gravitates to it like a magnet.

Below this line here are sell stops — not necessarily your sell stop, because you probably couldn’t hold a trade longer than today without getting nervous — but longer-term hedge funds have orders resting below those relatively equal lows.

So the market trades above the midnight opening price, which offers smart money the opportunity to sell short. Conveniently, the market also trips short-term buy stops along the way. This run up here stops out anyone who was short there, and this move here stops out anyone who was short from that prior move. So liquidity is engineered: buy stops here, buy stops here.

That allows the algorithm to run price up to the midnight opening price, giving smart money the opportunity to go short. Then their target is what? The level I told you last night: the relatively equal lows on the daily chart, around 1.07132.

Price drops just short of it, rallies one more time back up into the inefficiency — the SIBI — and then breaks hard into that pool of liquidity resting below the daily relatively equal lows.

Since I authored these concepts, it is imperative that you take notes and study these things in past price data. Don’t just take my word for it.

Obviously, you can hear me say what I’m expecting in future price moves, and you’re seeing those things happen. But don’t limit your study to only what I think is going to happen next.

Take your time between our sessions. Go back through old price moves and study the things I’m teaching. Ask yourself: does this materialize in the price action?

And you’ll find that it does.

These two close candles here — that is your bearish order block. Price trades up into that, then works lower once more, creating a shift in market structure.

So this right here is the 2022 model: buy-side swept, then the low taken. Is there a fair value gap in here? Yes, right there. Price trades up into it, giving you the opportunity to get short and aim for one more pass into that sell-side liquidity pool.

And there are relatively equal lows here. Price digs into them there, then bounces off that level, and we consolidate into the close of the day.

Alright, here is the one-minute chart, and we are dialed in on that actual run into the sell-side. These are the relatively equal lows from the daily chart — that level right here. We are viewing EUR/USD from the perspective of a one-minute chart.

You can see our sell-off here. Price breaks lower, then we have relatively equal highs and relatively equal lows. So we are creating this little trend-trading range. But what is the bias during this consolidation? As I mentioned last night, we were anticipating EUR/USD trading down into that sell-side liquidity — meaning the sell stops resting below 1.0713.

Price drops aggressively into that area right here, then whips right back above it. It trades one more time below it, but only to consequent encroachment, which is the midpoint of this gap — measured from this candle’s high to that candle’s low. Measure it on your own chart with a Fibonacci tool, and you’ll see that it hits that level precisely. Then price comes back to life, rallying above the short-term high.

So once the liquidity below those daily relatively equal lows is engaged, we can anticipate the market wanting to pull back inside the range. And that is what we see here.

What is left up here? Buy-side liquidity. There are buy stops above this area. Retail traders will see this as resistance — the average trader who reads a book, watches a few YouTube videos, and thinks everything works on imaginary support and resistance lines. They’ll trust this level, go short, and place their stop loss above it. What kind of stop? A buy stop to protect their short.

The market quickly runs for those buy stops because the algorithm does not want them to pull their orders. Smart money distributes their short position and buys up here, then adds for a long here to ride up into those buy stops.

We have an order block up here. Price trades above, then trades back down into a breaker: low, high, lower low. The highest up-close candle is right in here. Take that range on your own chart and extend it forward. Price returns into that bullish breaker, trades up from it, and then hits the order block there.

Then we consolidate going into the London close, which is between 10:00 in the morning and noon. We had a fair value gap here. Multiple times, price stays inside that range — this is time distortion. It has already priced in the high, and then it remains inside that range without meaningfully moving outside it. Look at the bodies. The wicks may go just outside that fair value gap, but that’s okay; it’s permissible.

Then we would expect price to trade lower again, reaching back down into the daily relatively equal lows once more.

Here is that move. We have the 10:00 to 11:00 window and the fair value gap after hitting the order block.

This would be your fill. But you could have multiple opportunities to go short, trading for the New York lunch run. Where would that be? Lower. Here is where the stops are.

This is the most energetic run prior to New York lunch. New York lunch is from 12:00 to 1:00. So prior to 12:00, where is the most energetic price move on the sell-side? Right there. That becomes the target. The algorithm runs down, creates a fair value gap, trips up into it, then breaks lower.

There’s your fair value gap. It hits it. That is the Institutional Order Flow Entry Drill, which is a partial entry into a gap that does not completely fill. Price breaks one more time, leaves another gap, and trades into the order block — two consecutive up-close candles — perfectly. Then it drops one more time, and that low takes out this low right here. After that, it springs back into the range.

That range right there is also a breaker if you look closely: low, high, lower low. Extend it forward. These two consecutive down-close candles make up one order block, and inside that, we have the breaker.

Why am I not using this one? You might say, “This candle went lower, ICT. You’re supposed to use the candle with the lower body.” This is the lower body. Also, this is occurring immediately after the high. I would not otherwise look at this as a breaker.

For instance, if this body here did not close as low as it did — if it had closed higher than that candle’s close, somewhere up here — I would not refer to this as a breaker at all. But because it created this sequence — high, low, lower high — and because the wicks do the damage, I’m going to look at that wick and discard it.

It’s a one-minute chart, so there isn’t much more refinement beyond that if we’re trying to define the breaker range. We have the high, the low, the lower high, and the two down-close candles. Extend that forward, and you can see price trade up into the breaker there, and again right there.

Then price reaches back one more time below the low prior to the New York lunch session, which is from noon to 1:00. You thought this only worked in ES and index futures? No. It runs here too, then trades back inside the range.

Alright, here is the weekly chart for the E-mini S&P. You can see that we traded down below last week’s low, and now we are back inside the range.

On the daily chart here, you can see that price worked inside that sell-side liquidity pool, as I’ll show you on the lower timeframes.

This rectangle will become much more meaningful once we drop into the lower timeframes. For now, it is simply the Opening Range Gap.

But I want you to notice how the bodies of the candles behave here. The open of this candle and the open of this candle are right at that Opening Range Gap. Again, this will make much more sense when we drop down into the lower timeframes.

For now, we are simply trading up inside this inefficiency here. So it will be important to see whether price rejects that area overnight going into tomorrow, or whether it powers through it and completely closes it.

If price trades above the gap between this candle’s high and that candle’s low, then I would treat that as an inversion gap — something bullish. Right now, though, I’m looking at it as a potential area to get short and look for lower prices, because we have one, two, three relatively equal lows here. That sell-side is really, really juicy right now.

We have already seen price go higher one, two, three, four, five, six times. So to me, this looks a little too tempting for a run below those lows. And yes, that is a large move, but we still have a lot of time between now — at the time of this recording — and Friday’s close, especially if we continue to see the Dollar Index rally higher.

Alright, here is the hourly chart on the E-mini S&P.

This was the sell-side liquidity pool I mentioned we would draw down into if price failed to find support. We got that as well — and look at the bodies. I mentioned that yesterday evening.

Then yesterday, I told you I was expecting price to draw up into a closure of the Opening Range Gap. You’ll see that in a minute, but also up into the buy-side right here.

Here is Tuesday and Wednesday’s Opening Range Gap. You probably remember that from yesterday. I like to keep Opening Range Gaps on my chart for three days. That is one of those gems that, if you’re not paying attention and you just let me say it without writing it down, will never really make it into your understanding.

After three days, it expires in my mind. This is all part of my Power of Three concept, which I’ll teach more about later. It’s not simply the open, high, low, and close, or accumulation, manipulation, and distribution. It’s much more than that.

The Tuesday-Wednesday Opening Range Gap is shaded here. That is what we were seeing on the daily chart. Notice that from Tuesday crossing over into Wednesday’s Opening Range Gap, price was still respecting it on Thursday. Look at the respect of it here. Look at this candle’s high. Look at the bodies in here. See that?

There is a lot more going on behind the scenes that is algorithmic. Unless you know about it, you’re completely oblivious to it. The average trader who understands gaps does not think about the market like this. That is what separates me from everybody else.

If you want to be an apex predator, you have to hunt differently. You have to be the first one to take the prey. You can’t wait around. This is not “the second mouse gets the cheese.” We are not mice. We are lions. We go out and take it.

The buy-side is what I told you we would reach for yesterday — right above here — and that we would trade up into the high end of that gap. Yesterday, when we were talking, price was right around here. Then we opened up here, traded down at 6:00, meandered around, and eventually found our way up to it and above it, but fell short of the buy-side liquidity here.

So what is the objective still? To run those stops. Then price comes all the way back down to the low of that Tuesday-Wednesday Opening Range Gap.

What am I referring to when I say the Tuesday-to-Wednesday Opening Range Gap? Where do I get that information from?

You have to change your chart to regular trading hours, not electronic trading hours. Then you’ll see the separation between the settlement price and the opening price of the new day. So this is what happened on Tuesday, and we also have one here.

I’m going to add this one and change it to a different color. It will still remain on the chart because it is very important to understand what is about to happen here. I’ll shade it in gray so it’s there like a ghost behind the scenes — no pun intended, the ghost in the machine.

So now we have the Wednesday-to-Thursday Opening Range Gap, which is this broader range here. That means we have an overlap between those two Opening Range Gaps.

I promise you, you will not see this in books anywhere. This is the first time I’ve ever taught this. Even my charter members don’t know this.

So today, May 25, 2023, I’m teaching you something I have never given to the public before. I want you to appreciate that.

After we get this Tuesday-Wednesday Opening Range Gap, price opens above it, trades down, and finds support at the low of it. You see that? But it did not fill this area.

Why didn’t it fill it?

Because there was unfinished business. And where was the unfinished business? The buy stops up here. Price ran up there and hit them.

Now we have another gap. Just like we were treating yesterday’s Tuesday-Wednesday Opening Range Gap, there was still a portion left to fill in. Now we can look at this area here as a potential area for price to reach into tomorrow, or reprice back to.

That is my expectation going forward. I could be wrong, so don’t put too much weight or emphasis on it. But that is how I’m looking at it. We are going into a holiday weekend, and anything can happen. I’m not going to be watching the market tomorrow because we’re doing something with the family, so I could care less what the market does.

But if you held a gun to my head and said, “ICT, tell me right now what you think,” I think we’re going to attempt to get down here and work toward this area. That’s what I think.

If I’m wrong, price would need to get back above the current New Week Opening Gap high for me to become bullish again.

So now we have both gaps: the Tuesday-Wednesday Opening Range Gap and the Wednesday-Thursday Opening Range Gap.

We’re back down here on electronic trading hours. You can see the relatively equal highs. I said last night that there was buy-side here — go watch the video. That is where I thought price would draw to, and I expected it to reach the top of that old Tuesday-Wednesday Opening Range Gap.

Well, we did that here. Then we fell short. Notice what happened: price went above the range high there, but it had not yet reached the buy-side. Then it dropped all the way down to the low, which validated the long. You can still see it in here — and boom, it gathers all kinds of new orders.

But not by itself. Look closer. What is this? A fair value gap at the lows. So smart money is accumulating right in here. The market rallies, comes back down for one more tap, then takes off. It trades into a buy-side imbalance / sell-side inefficiency, which is a fair value gap, and also into an order block right there.

Where is the target? The buy-side I told you about last night. Wham — it hits it beautifully.

Does it continuously keep going higher? No. It rejects, comes back down into the range, runs buy-side, rises one more time, pumps into it, and then fails once more.

So I’m watching to see whether this potential phantom trendline breaks. If it does, we’ll be looking for the sell-side here, below here, and into the gap that would normally be expected to fill.

But again, it’s a holiday weekend. Anything can happen, folks. Volume will be different than normal. A lot of people are simply going to step away. They’re not going to be trading or doing anything. So bear that in mind tomorrow.

So now we’re on the five-minute chart, and we’re bringing in the New Day Opening Gap.

We have the closing price at 5:00 and the opening price at 6:00. That separation is what we’re showing here. That is your Wednesday-Thursday New Day Opening Gap. Extend that throughout the day, and you can see how we get consequent encroachment over here, then price sells off.

Consequent encroachment is half of any inefficiency or gap. Mean threshold is half of any order block.

There is a distinction there, and it is very important to keep that distinction clear.

Then price falls just short of hitting the top of it here, works outside of it, and then trades back into it one more time. Notice that in this little area here, we are hitting an order block, but we are also at consequent encroachment of the low and high of that gray-shaded area. That gray-shaded area is the Tuesday-Wednesday Opening Range Gap.

Take that range, split it in half, and that is consequent encroachment. That is what you are seeing right there: order block plus consequent encroachment of the Tuesday-Wednesday Opening Range Gap.

Price rallies. Yes, I’m going to make a specific tutorial video for Opening Range Gaps, but I have to teach it and prove the conceptual idea to you first. I’ve done this in live streams, and I’ve also talked about it in analysis, but right now I’m giving you the foundation. Then, when I give you the full lecture, it will be like, “Oh, now he pulled all those loose ends together. Now I see what he’s talking about.”

So that consequent encroachment rallies, then we get a small gap in here. Price trades down into the low end of the Wednesday-Thursday New Day Opening Gap — this one over here.

You can see very quickly that unless you have these levels on your chart, or unless you have them written down like I do, you’re going to miss this. I look at the chart and I already have these levels in my notes. You’re probably wondering, “Can you show us your notes?” It’s simply these prices, labeled by what they are. That’s all it is. It may not mean much to you yet, but I’ve been doing this a very long time, so I know the levels I’m looking for, and I’m looking at them in terms of time.

So what is specific about this area here? It’s occurring around the 8:30 news embargo. We had news coming out, and then we had impulsive price action. Price runs up, retraces, runs again, falls short of our objective, and crashes back down into this order block here.

And what else is it? It is also the low of the Tuesday-Wednesday Opening Range Gap. That shaded area here — see it? It lines up right with that order block. Price digs into it, digs into it again, then rallies one more time. And finally, it blows out the buy-side that I told you last night would be the objective for Thursday, May 25, 2023, on ES.

Then price slips lower into consequent encroachment of the New Day Opening Gap — this gray area — and rallies one more time into the rejection block, which is the highest up-close candle here.

And then they suddenly realize, “Man, this is way too much information.”

You don’t need all of this. This is 30 years of experience in my models, my tools, and my concepts. I know this stuff like the back of my hand. You only need one thing — one setup.

I’m giving you a plethora of setups to work with. It’s your job to find the ones that match your personality and make the most sense to you. Not all of these things are going to make sense to everyone. In fact, it may only be one or two things I ever teach that make you say, “Okay, I understand that. That’s amazing. That’s great. This is all I need to find my setup and make money from it.”

That is your job here.

You are not trying to take everything I know and force it into every single chart you look at, because these things will not always appear. A breaker is not always there. A mitigation block is not always there. An Institutional Order Flow Entry Drill is not always there.

So keep in mind that you are still expected to bring your own personality into this. And the way I teach and mentor allows for that. I am not trying to rule with an iron fist and say, “This is what you’re going to do, and only this,” because that doesn’t work.

There are people who will say that I do that, and they’re lying. I don’t do that. I’ve given you many ways to skin this cat.

And like I’ve said many times before, I could create a new model every single day for an entire year and still not run out of yeast. This baker does not run out of yeast. I could literally bake cakes with profitability for the rest of my life, and it would look completely new and fresh every single time you sat down with me.

Thirty years of insane study and insight that you would never glean anywhere else — that is what you’re seeing here. It doesn’t mimic anything else. It’s not supply and demand.

The market is reaching for inefficiencies and liquidity, and it is doing it on a time-based delivery schedule. That’s it. That’s all it’s doing, folks.

If you continuously remind yourself that this is what it’s about, it will remove the tendency to say, “This is too complicated.” Because it’s not complicated. I’m simply showing you everything available to you.

You have to decide: this is the time of day I want to trade, this is the market I want to trade, this is the setup I want to trade, and this is the framework I’m hunting. If it’s not there, I do nothing.

But it will exist at least once or twice a week, and that is enough.

The problem is that you want every session, every day. You want to be in every swing. You want to justify why you weren’t in a move every single time. And you want to be in every move that makes money. That’s impractical, and it shows infancy as a trader.

I once believed there was a way for me to do that too. And even with everything I know, I still can’t be in every move. I have to sleep. I have to do things with my family. Sometimes I’m simply not interested in looking at the charts.

That’s reality. So you can’t put that much pressure on yourself.

Let’s keep going.

Alright, now we’re going to get into some order flow. This is going to be a little more in-depth, so just bear with me, because this is probably going to be one of those videos you’ll want to come back to later.

Come back to this one a few times this year — maybe every three weeks or so. Each time you revisit it, you’ll understand more of what I’m talking about. It may even feel like a brand-new video each time you watch and listen, because some of the information I’m showing won’t fully register the first time.

For the older students, those who have been with me for a long time, this is going to be a little more advanced.

Alright, we have the 10:00 to 11:00 AM Silver Bullet hour. This is ES on a one-minute chart.

You can see that at the high end of that old Opening Range Gap, price opens and then slams down. Remember, we fell short of the buy-side liquidity I thought we were going to reach. So price went outside the range of the Opening Range Gap, then right here it slammed lower and traded down into the order block I showed you earlier.

That blue line is the order block from the five-minute chart. Now, on the one-minute chart, we’re studying the 10:00 to 11:00 window. We are zooming into the same price action that was shown on the five-minute chart, magnifying that small area here on the one-minute chart.

The market drops down and creates a fair value gap in the form of a SIBI — sell-side imbalance / buy-side inefficiency. We create relatively equal highs and relatively equal lows, then price trades down. Remember this shaded area here: this is the low of the old Tuesday-Wednesday Opening Range Gap. Price trades to that low, hits here, hits here, and look at the bodies respecting it. The wicks go just outside it, then price runs these relatively equal lows and quickly rallies back up, taking out a short-term high.

Now we have something.

This is the 2022 model I taught on the YouTube channel: take stops, shift market structure, then buy the fair value gap. That is your Silver Bullet. So yes, you can blend the 2022 model with the ICT Silver Bullet idea. It is not always going to be a continuation model. Sometimes you will treat it as a reversal, and this is what you are looking for here.

These arrows are only for illustration, not executions. I’m showing you where your entry would be. This is how you want to do your own journaling. In empty areas on the chart, annotate and reward yourself with positive self-talk: “It was amazing to see this pan out the way I expected.” Then, when you look back at it a week later or a month later, your subconscious remembers that as pseudo-experience.

By conditioning yourself with positive self-talk and never putting anything negative in your journal entries, you train yourself to see the positive aspects of these price-action examples. You trick your brain into treating them as if you actually experienced them, and that fuels your motivation. It also removes uncertainty because you are training your expectation, understanding, and subconscious recognition to see these things faster.

If you only watch price action and rely on someone else to point things out, you won’t develop that skill properly. When you backtest, study, and journal, you need to put real work into it. This right here is better than most technical-analysis books. I have books I spent hundreds of dollars on that are not this annotated or this detailed.

I took 30 years of experience — what I look for in price action — and applied it to these charts. These chart examples are fractals in price action. Treat this like meditation. The more you put into it, the better technician you’ll become, and that technician will make you a better trader than you ever imagined. But you have to do this step. You cannot skip it. There is no way to learn this without backtesting, journaling, and study.

If you don’t want to do that, expect to fail. That’s the honest truth. There’s no sugarcoating it. If you try to do it fast and don’t put in the effort to do it correctly, you will not be successful, and you’ll have nobody to blame but yourself.

There are two Silver Bullet opportunities here. You have this one here, where price trades down into it, and this one here, where price rallies up, takes the buy-side, and runs into the bearish order block. It doesn’t even need to trade outside that old Wednesday-Thursday Opening Range Gap.

So we have profitability while still being “incorrect.” We were aiming for the buy-side. Wait a minute — you can be wrong and still profitable? Yes.

Remember the rules for the Silver Bullet on ES or index futures: it has to offer at least a 10-handle range. If you’re buying down here around 4142 and expecting price to go up to the buy-side, that is the best-case scenario. But you also have these gaps here: the Tuesday-Wednesday and Wednesday-Thursday Opening Range Gaps. The algorithm will refer back to those same levels. It is not just doing it today or yesterday. It will do this in perpetuity.

Every day in the future, it will remember these levels for up to three days. Sometimes it will refer to them beyond three days, but using three days as a general rule of thumb will serve you well. After three days, take it off your chart. You don’t want all of them cluttering the same chart.

You have to curate templates. Templates are useful. You can have one template that holds all of the Opening Range Gaps. This is what I’m referring to when I tell you I have 12 different monitors and I’m constantly cycling through everything. I’m looking at these levels the whole time while I’m talking to you, especially when I’m doing live sessions and calling the market live on Twitter. I’m constantly gathering information and Intel, referring to these levels while price is marching along and ticking away.

I’m not reacting to price. I’m anticipating it.

As my student, you’re going to learn how to anticipate too. Retail traders react. They are essentially breakout artists — they hope something happens, and when it does, they react to it. We are anticipating specific things. When they occur, we’re already there. We meet price right when it does what we are looking for. We buy when it is going down, and we sell when it is going up.

That is completely opposite to retail-minded trading. That’s not meant to be condescending toward anyone using retail logic, but there is a huge chasm between what I’m teaching you and everything else out there. This is light years beyond it, because this is what the market is actually doing every single day. That is why I’m accurate. That is why you see me call it beforehand and then watch it happen. My students have learned from me, and they are doing it too.

The rule is that it must offer at least 10 handles. In futures, points and handles are the same thing. I’m an old guy, so I use “handles” because that’s how we used to talk about S&P futures. One handle is one point, which is four ticks.

For a high-probability ICT Silver Bullet trade in futures, it requires at least the potential for a 10-handle run. If we are trying to buy down here, and this is the best-case scenario, all price needs to do is print 4147.00, and the spread can fill you. So you could be long around 4147.25. Ten handles higher would be 4157.25, which is right here. And that still isn’t even outside the Opening Range Gap; it is just at the high of the New Day Opening Gap.

So that is definitely a high-probability long, because it offers the opportunity to get 10 points or handles before price even reaches the area we are ultimately trying to get to.

And then, moving into the afternoon, this is a 15-second chart of what I just showed you with the Opening Range Gap, the New Day Opening Gap, and the Silver Bullet between 10:00 and 11:00. I stripped price down below the one-minute chart.

I’ve said this before, and I talked about it in the Twitter Spaces before I actually taught the Silver Bullet. I first taught the Silver Bullet in a Twitter Space, which is like a podcast — just explaining vocally what it is and how it looks. Then I taught the lesson, the lecture, and that was only an introduction. There is a lot more to it, and I’ll build on it as we go throughout the year, which is what I’m doing here.

People ask, “What timeframe do you look for? Where does it form?” It is a fair value gap that price trades into between 10:00 and 11:00. It does not need to be a fair value gap that forms between 10:00 and 11:00. It can be a fair value gap that formed prior to 10:00. The important thing is that the entry occurs inside that window.

Everything I showed on the one-minute chart — let me go back and show you again. Look right here. This is the one-minute chart of the Silver Bullet here, and this is the Silver Bullet here on the one-minute chart. There is a lot of overlap in here. Then finally, price leaves the range, creates this fair value gap, trades down into it, and runs away.

Now let’s go into this information in a little more detail. I also want to look at all this imbalance here. Why is price going up to this level and stopping? Look right here. Here is your order block. It will not go beyond that. What is occurring in here? What is all that about?

This is institutional order flow. You are not going to see it through volume profile analysis. You are not going to see it through depth of market. You are not going to see it on a ladder. You are not going to see it through Level 2 data.

All of those things you think make you institutionally minded — they don’t. They do not. All of that can be spoofed.

What I’m going to show you here is why it never surprises me. It never jumps off the chart and says, “Gotcha, ICT. You didn’t see that coming, did you?”

So think about what I’m showing you here. Study this for a second. Pause the video. Really pause the video and study everything you see here: all this movement down, where these Silver Bullet entries are occurring, and where price reaches up here.

It may not look obvious on this chart, but when we drop down to a 15-second chart, which I’m about to do now, it will become clearer. So if you’re not ready and you’re still studying this, don’t press play yet. Keep it paused. If you never pause the video, you’re missing an opportunity to learn.

Back to the 15-second chart. Here is that sell-side imbalance / buy-side inefficiency.

All of this run lower into this low creates these relatively equal lows, and then price goes just shallowly below them. That shallow run tells me that any retracement higher is likely going to lead to one more drive lower.

And what does price do? It runs right back up into some random level? No. It runs back up into that fair value gap right there. See that?

It is also a mitigation block, which is this down-close candle. We have high, low, lower high. It is a reversal-type variation of my breaker pattern. Typically, a breaker is high, low, higher high. A mitigation block is the down-close candle between the high and the lower high.

So price trades up into that, bounces there, and then drives harder lower. That takes out the sell stops here.

So it engineered the move. Price went low, low, creating retail-minded support. Traders buy it. Price rallies, they feel rewarded, and then it comes back down. Whether they were stopped or not does not matter. If they did not already have a stop, they are definitely going to place one below those lows — below that low and that low. Then you see price go: wham.

It spends time down here, trapping traders, then rallies and takes out a short-term high. That is a shift in market structure. It creates a fair value gap on the one-minute chart, but look closer now — this is the 15-second chart.

“ICT, come on, bro. Seriously? I’m not looking at 15-second charts.”

Okay, then this lesson isn’t for you.

I’ve already taught you how to trade using the 2022 model. You don’t need this. You do not need this to make my concepts work.

But if you want to be a freak in technical analysis — actually, scratch that — if you want to be a freak in technical science, because that’s what I teach here, then this is for you.

We do technical science here. It is not contrived. It is not conjecture. It is not guesswork. We have this refined down to the smallest degree and the highest level of precision.

Look closer inside that shaded area. On the higher timeframe, it looks like a fair value gap, but you don’t see it as a fair value gap here because we are on a 15-second chart.

On my monitors, I have one screen I call my intraday matrix. I’m constantly toggling through timeframes with a few keystrokes: five-minute, four-minute, three-minute, two-minute, one-minute, 45-second, 30-second, 15-second, and five-second charts. I’m looking at charts like that while referencing key levels.

So when we’re inside this institutional area, where orders would be resting — what kind of orders? Sell-side liquidity — price rallies up and gives us a shift in market structure. Wonderful, because I’m expecting buy-side liquidity, which is outside the scope of this chart. Remember, it’s above, and that is where I think price is going. I told you that last night.

This one-minute imbalance that’s shaded here doesn’t look like a fair value gap on this chart. But what is overlapping on the 15-second chart? Something still useful, using the PD Array Matrix I taught in the core content on my YouTube channel: two down-close candles forming a bullish order block. Extend that to the right. Price digs down into that order block, rallies, and then comes back down into it again.

There’s an order block and a fair value gap right there. If I didn’t buy it on this pass here, I would see that and go long. Then I would buy again here, adding more and pyramiding.

That’s why sometimes, when you see me entering, you’ll notice I buy, and then a few seconds later I buy again. You might wonder, “What is he doing?” This is what I’m doing. I’m buying it here, buying it again here, and adding more here.

So it might be six contracts long, then three contracts, then one contract — that’s my 10-contract model. Six here, three here, and then one here. That builds into the full position if I think the trade is good.

But if I don’t see the lower timeframes doing this, I’m not going to take those close-proximity entries where I show multiple entries generally in the same area. I’m dialing in with very small, sub-one-minute chart data. It looks just like this, but you’re not seeing it unless you have a 15-second chart or lower. TradingView offers that.

Same thing here with that Silver Bullet up here. This range is a one-minute fair value gap, but you can’t clearly see a fair value gap inside it on this view.

You do see this down-close candle here, though. So when price trades down into that, that is where I’m going long. I would be buying that order block right there.

And then, as price was dropping down, if it hit that shaded area again on the 15-second chart, I would add to it there. Then the market runs up.

Look a little closer now.

When we study this inefficiency, all of this movement down here contains small pockets where only one candle passed through. We had a small one here, another small one right in here, and then this area here — one candle pass-through, another one here, and another one right in here.

This one here is essentially repriced right there, and it is rebalanced because price lifted through it here and here. So that one was of no interest to me.

This one gets filled in, repriced, and rebalanced because price trades back and forth inside this area here. So now that area is balanced.

If we rally above that high, then price should have no problem going higher, and it should not need to go back below that high again.

What I just said is huge, because everything over here is telling you the narrative that needs to be displayed in price delivery.

Once we have this back-and-forth movement, that means price has efficiently balanced that area. Once it leaves it — meaning once it trades above it right there — it does not need to go back below this high again. Not until it trades above and rebalances into this area here.

This range here is this price formation. Price reaches up into it, then pulls back lower.

This range in here — price trades up into it, finds support at it, and then rallies above it. Once it does that, it does not need to go back below this high. It acts as support, then rallies again.

As I taught last night, if you want to understand what classic support and resistance really means, and how to look at it properly on a chart, you need this level of depth. But if you don’t want to be a technical-science major and you just want simple trading, then look at the inefficiencies around the levels where you would normally expect support or resistance.

If you see the things I’m teaching you here, you can probably trust that support or resistance more safely. That does not mean it will be 100% accurate. It means that if you are trading with support-and-resistance ideas, and these inefficiencies to the left of the chart are balanced — not just repriced to, but actually balanced — then that level becomes meaningful.

Balanced means price has delivered up and down through that area. Once it leaves that range, it becomes a real balanced price range. Then you can trust that price is less likely to go back through it. It should act as support if price is moving higher, or resistance if price is moving lower.

You can see that area here. Price works this level back and forth, and once it leaves it, it becomes balanced. So all I need to see is price trade above it. That high right there gets traded above, price comes back down, and it never sees it again until we get to this area here, where this inefficiency has been rebalanced.

This candle here trades down, then price opens, trades down, trades up, and leaves that range. That is the only exposure for inefficiency. Because this candle went up, this candle went down, and this candle opened, traded higher, and then came back down, this range up to that high is balanced.

The remaining inefficiency is this candle right there. That is why price only went right up to that level — to the tick — two candles later, and then plummeted down to the New Day Opening Gap low, and then further down into the consequent encroachment of the Tuesday-Wednesday Opening Range Gap, which is slightly outside the scope of this fractal being shown.

Alright, here is the one-minute chart on the E-mini S&P, afternoon session between 2:00 and 3:00. This is your PM Session Silver Bullet.

This is where we saw price rally up and trade into our objective. This is the buy-side liquidity pool I told you last night that price would reach into before we got there today. It did so during the 2:00 hour, ran through it, and then broke hard lower, leaving this inefficiency right there.

The market trades back up into it, and that would be a short for the Silver Bullet because we already hit our objective. We broke down, and now we can look for this inefficiency here. And this has a real gap. See that?

This, friends and neighbors, is a real liquidity void. That is a real liquidity void.

This is not a liquidity void.

This is not a liquidity void.

This is a liquidity void — where this candle stopped and this candle started. That separation means there was no price printed there at all. No trades existed there.

So when price creates this inefficiency lower, is it a fair value gap? Yes. More specifically, it is a SIBI: sell-side imbalance / buy-side inefficiency. That means it is lacking buy-side delivery. So a candle, or multiple candles, must go up through that range to offer that delivery.

We see price return back into it here, and that would be a short, expecting price to go back down into this inefficiency and trade into that real liquidity void.

It pumps up one more time into here, but does not even get back up to the first Silver Bullet fair value gap. Then it breaks again, leaving a small gap in here. I would counsel you to study this area. You might look at this and think, “Oh, this could have been a potential entry too.” But would I enter there? No.

Why? Because, with the benefit of hindsight, you can now see what it did: it took sell-side out here, then came right back up. That is too close in proximity, so price could run above here to take buy-side and take this high. So I would want to drop into a lower timeframe and look for something a little higher than this, or study this area to see whether there is another fair value gap that is not visible on the one-minute chart.

I’ll drop down into a lower timeframe — a 10-second chart — and show you what that looks like in a minute.

But the market breaks lower and does, in fact, trade back down into this inefficiency and rebalance price action right into that real liquidity void, trading down into 4153.

Now the question is: does this offer 10 handles, or 10 points, in range for a potential high-probability short? Because we already hit our objective: the buy-side liquidity pool. Remember, that was the target I gave you last night. Price hit it during the PM session, in the 2:00 hour on a Thursday.

Thursdays can generally — not always, but generally — give you the opposite end of the weekly range. Since we have been bullish all week, there is a chance we could create the high of the week on Thursday. That does not mean it always happens, but many times it will give you trades that are very short-term and produce this type of movement.

We eventually tried to go back up again, but this move was enough to get paid on.

So does it offer a 10-handle range? If we are going short here at this candle’s high around 4169, all price needs to do is print 4169.25, and the spread should fill you short. It does more than that.

But for this example, we are going to assume this is not a real trade. This is for annotation purposes so you can do the same thing in your journaling. This is where you would be filled. This is how much heat, or drawdown, you would have taken. Then the market breaks lower.

As price trades into the lower end, or consequent encroachment, of this inefficiency — about right here — the spread would probably require this candle here for a fill. Notice I’m not drawing it on the absolute lowest candle, because that would be impractical. I’m showing you how to do your own backtesting.

Annotate where you realistically would have been filled. Do not try to pick the highest high and the lowest low. That will not help you. It will not make you a super trader. Be realistic and practical when you backtest. Mark where your orders would have been filled using the logic and rules I’m giving you.

That way, you can study with realistic expectations: where your entry would have been, how much heat or drawdown you would have taken, and how price delivered afterward. You can see that this is not the actual high; a little more heat is given before price drops lower.

Now, right away, I’m reading your mind. I’m getting the impression that you’re thinking, “Why wouldn’t you expect price to go all the way back up here and completely close it in?”

Well, what did this run do? It ran the target I gave you last night. It ran buy-side liquidity, and it did so energetically. Then we created this gap here. So this is a blow-off type move, almost like capitulation. I’m not suggesting that we have made the high, but I’m showing you that we can trade it with that expectation.

This is much like a breakaway gap. This gap should not completely close. Notice that price came back up later on, but it did not completely close it in. It still left a portion of it open right there.

But we only need 10 handles to see whether it offers us an opportunity between 2:00 and 3:00. If the entry is around 4169.00, which would be this candle’s high here, and we were getting short there, then 10 handles lower would be 4159.00. That level is down here. Price has not even taken out that low yet to reach 4159, and we’re aiming for this inefficiency.

So yes, it would be a high-probability trade.

From 4169 to 4159, there are 10 handles. You can book five, take a partial at 10, and see if you can get down into the closure of this inefficiency. But I would personally aim just for that real liquidity void. I would not aim for the low, even though price did offer it. I would be closing right there as price traded into that liquidity void.

So I’d be out there, or best-case scenario around that level, and I would miss any further downside movement here. I would not be engaging in any of this afterward.

Everything I just showed you, we are now looking at on a 10-second chart.

Here is the inefficiency. You can see it is one single candle here, and your fill would be there. That is where you should have been filled. This is the heat you would have taken, or how much it would have moved against the open short position.

This up-close candle here is a bearish order block. The market trades lower. See this inefficiency here? That did not exist on the one-minute chart. This is the one-minute fair value gap after price took out this low here, moved down, and then ripped higher back up into the order block.

Look at the inefficiency here. Price trades into it, touches the order block, trades sideways a little, then breaks down back into the high of the fair value gap and reprices lower. Then we start respecting that one-minute fair value gap here, and once price leaves it, it becomes a breakaway gap. Price moves lower and digs into that real liquidity void, which was about halfway through that pink area.

If I showed you the chart with all of these levels on it, you might think, “Man, what is going on here? What is all this stuff on the chart?” But this is the insight I have. On my chart, I have these levels annotated, and as I’m watching price, I’m constantly referring to them.

For example, the 4160.75 level is the high of the Wednesday-Thursday Opening Range Gap. So as price trades down, I’m watching how it reacts there. It hits it, comes back up, fills in a small gap — that’s normal — then breaks strongly lower.

As it breaks lower, I’m also watching the ghost image of the previous Opening Range Gap. I want to see whether price digs into that. Yes, it does. It also digs into the New Day Opening Gap. So I’m watching all of these levels and looking to see whether price can go a little farther. Each time price reaches into one of these levels, another PD array may create interest for some measure of retracement.

If an inefficiency has just formed, I expect price to reach back up into it, like it does here and here, before digging deeper. This is where I would have had my exit: as price traded into that real liquidity void, where the separation between the two candles exists right there.

All of this congestion is visible on the 10-second chart, but this level of detail cannot be gleaned from a simple one-minute chart.

You do not need this to be profitable. You do not need this to find Silver Bullet trades that work. But by using sub-one-minute charts — meaning anything below one minute — I can find trades that would not be visible on a one-minute chart.

I’m comfortable with that, but you may not be. Just because I can do it, just because I like it, and just because I’ve been doing it for a long time does not mean I’m twisting your arm and telling you that you have to do it too.

All of these things work. You don’t even need to be trading on intraday charts. You can trade from the daily chart if that fits you. I teach intraday because it gives me many more examples and opportunities to present things that would take a long time to manifest on higher-timeframe daily and weekly charts.

Because it fits my personality, I’m comfortable making high-frequency decisions. High-frequency trading is done on these sub-one-minute candlesticks. They use these types of inefficiencies and reference points for their algorithm. They are only shorting when the market goes up, and they are only going long when the market goes down. They are reading inside all of this.

Remember, just because price is creating all these fair value gaps here does not mean anything by itself. Just because price trades up into this order block here does not mean anything by itself. It matters because we went into that buy-side liquidity, which is the level I said we would run into — and we did that here around 2:00.

Once price did that and broke aggressively right there, I wanted to see it get back below that high, which is this blue line. It does. It breaks down below it, overshoots this inefficiency even on the 10-second chart, and digs down into the volume imbalance right there. There are no bodies overlapping — just the wick. Boom, it hits that, then runs one more time back up into the two-minute fair value gap here. Boom, boom, boom — three times. That is the three-drives pattern, a very classic pattern.

Then it breaks lower into inefficiency. I like that one. That could be a short, and I would be adding to it. My stop would be above here.

What happens if I got stopped out? Then I would wait for something like this to occur later over here. Once price broke down and created another fair value gap, I would be shorting there and adding in the same way I explained here.

So here is what I’ve taught you tonight.

Obviously, I showed you a greater degree of precision and explained why I take my entries where I do. When you see me entering on a one-minute chart or a five-minute chart, it may not seem logical to you at first. But I’m looking at lower-than-one-minute charts as well. I’m studying the inefficiencies, the order blocks, and the points of reference I’ve shown you here.

This is only an introduction to it. Every PD array I’ve taught — plus the ones I will never teach you — I’m looking for them. You don’t need all of that, but I can teach you how to do this if you’re willing to listen and go into the charts to look for it.

Silver Bullets are simply fair value gaps that exist inside a 60-minute window. But there is not only one way to trade a Silver Bullet. It is not a one-trick pony. There are many ways to get into a Silver Bullet trade. There is more than one Silver Bullet for me.

That is why I said there is always one for me. Some of you may look at a chart and say, “I looked at this and it didn’t form. This doesn’t work. He said it forms every day.” No — you’re not looking at these timeframes. They are there every single day: between 10:00 and 11:00 a.m., between 2:00 and 3:00 p.m., and between 3:00 and 4:00 during the London session.

But you have to know where price is drawing to.

We were expecting price to draw above and take the buy-side here. It did that. So once it has done that, what are we expecting? It is probably going to pull back and offer some measure of retracement. That is reasonable, and it gives that.

That is all you need.

The question is simple: does the move offer you 10 handles if you are only trying to get five handles, which is what the model teaches?

This is how you get it every single day. You will lose sometimes. I lose sometimes. I get stopped out sometimes. But if I get stopped out and the criteria still exists in the price chart — and nothing has really changed — then maybe I simply had poor execution on my stop placement, or maybe my entry wasn’t as pristine as I would have liked.

If the trade is still viable, I will re-enter. You’ve seen me do that in my execution videos as well. So just because I get stopped out, or you get stopped out, does not mean the idea is invalid. If the trade still exists within the framework and the logic is still there, look for the next signal to get in. You don’t need to chase it. You need to use the one-minute or lower timeframes and wait for your setup.

Think about it like this: if I saw this order block — say, for instance, I was looking at this area here and I hadn’t been in front of the charts until then — I see the order block, and I want to see price reject it. It does. Then we create this little fair value gap right there.

When price runs up into that, and it is the high where I said I wanted to see the buy-side taken, that right there is an entry for me. I don’t need to be in it here. I don’t need to be in it over here. I can be in it right there, and that is not chasing price.

I can use this order block right here because we haven’t even taken out this low yet. We have a closed candle. This is all happening on a 10-second chart, and I’m watching all of it. This up-close candle, when price trades away from it and then comes back up into it — as this candle is hitting it, I can be short right there. My stop would be above the fair value gap candle here, right there. That is ultra-tight.

And I could pyramid more. I can be shorting here and pyramiding more here because we haven’t yet taken out a structural low that would create acceleration in my favor. And I am still far above my target.

So in the scheme of things, I’m entering here and my target is here. This is inception. This is terminus. The midpoint, or equilibrium, is right here. So I can absolutely take this trade because it is above equilibrium and still in a short-term premium.

See that? That is institutional order flow, folks.

It has nothing to do with volume profile. It has nothing to do with Level 2 data, DOM, or depth of market. You do not need any of that.

But you do need to know where price is drawing to. Where is it going next? It is either going there for stops, or it is going there because it needs to reprice and redeliver where inefficiency exists. That’s it. That is all it is doing.

If it is not going to do either one of those things, guess what it is going to do? It is going to go sideways, and you cannot make money in that.

So that’s going to be it for this week. Hopefully, you learned something this week. Enjoy your weekend, and be safe.