Transcription
Hello everyone. I hope that you guys had a wonderful week, as I did. I see all of you guys doing well, as usual. Right.
So, before going forward, I'd like us to have a very short conversation where we exchange, you know, thoughts. And I would like you guys to, you know, ask me questions. Let me know what you guys have in your minds, like any doubts that you guys have. What are your problems, if you have any? Right?
Most of you already know what you need to work on, but it might be something personal which might not be even within the charts, right? Might be something that's mental. So, we'll just be doing this for around 5 to 10 minutes, and then we will get to the charts, right?
Daniel wants to know when sequential SMT will skip a cycle and use the next. Right, we will talk about that in detail, right? Usually, yes, when you have SMT skip, then you see that that's something that amazes me, like when I haven't even talked about this really, but you guys already know, right? That's that is there. You already know that there is a way to know when it will happen, right? Pretty much, I have shared these things with you guys before, not right or right like that, but I have. It usually happens on days that we don't have high impact news events, right? Other than Mondays, because whenever there's no news on Monday, if there's sequential SMT, that's something that is very difficult to predict, right? And usually, it's something that you would predict using only technicals, right?
So, yes, with that being said, we will begin. So, yes, as I've said before, this week we had the presidential elections, right? And we had price just expand, which is crazy, right? Because we had sequential sympathy, which occurred before we had the expansion, right? So, usually, and this is not something that is random, you guys already know. You'll have when, as I've said before, when you have sequential SMT before a high impact news event, price will run in the direction that the sequential SMT is already pointing towards. I've already, I've always said that, right? And I did come again and say that after we had the news, right? Wednesday, we had no news, but price still expanded, and then Thursday, price expanded a bit. There was no re-, there was no reversal, right? And this is a week that the only news event that would, you know, make sense will obviously be the US presidential election, because all of the liquidity will be forced through that window of time.
Here, we'll talk a bit about Bitcoin since, right? We have been, you know, correct for the past few, I'd say months, right? So, this right here that you see trading within this fair value gap, this candle, it is a precision swing point. But now you're going to learn something else that I'm pretty sure that most of you guys have picked up before. A precision swing point does not only occur when you have one candle in regards to this asset, just the base asset Bitcoin being up close and the next being down close. It can also occur whenever you have a swing point forming within one asset and one, the other asset not forming a swing point, right? So, this in itself again is a cracking correlation, as long, and especially here where you have this swing point being formed within this fair gap, right?
To refresh you guys, the memory of you guys, we were bullish since the formation of this candle, even before the formation of this candle, right? While this candle was trading within this gap, and even though it was a lower time frame, right? We expected this candle to trade below this one. Then we expected price to continue higher to the to all-time highs. This in itself is a wonderful trade which I took. You guys saw my executions, I believe. And these are the best types of trades, right? With these types of trades, you have time to think. You don't need to be rushing. You have time to calculate your stop loss and everything like that, right? Swing trades, if you will. They take a few weeks to pan out, four to five weeks, and they are, you know, very explosive.
So, here, and this is the base of all of this movement right here. Right here, we had a cut in correlation. Price traded within this gap, traded higher here, broke the highs. Apart from this, right? And after, you know, we talk about the sequential SMT which is occurring here, the SMT that's occurring here, the sequential SMT that's occurring here, right? Because this right here is not sequential, this high breaking through this high is not sequential, but this high breaking above this high is sequential, right? So, after I talk about this, we're going to be referring to referencing to these three last candles that formed, right? These three last weekly candles. So, here we have this high being taken out, this high being taken out, and here none of these highs have been reached as yet, which does what to us? What does this signal to us that we should not be considering to, you know, buy this at the moment? It's very simple, right? All that we're doing is following our rules, right? Which gets us on the right side of the market most of the time. We do not care for perfection because there is no perfection. And as Mathan said, and I will ask, can I talk about trading psychology? That's just me dropping it in right there. You should not expect to be perfect because you will not be. Right? Instead of seeking perfection, you should be seeking consistency, right?
So, yes, here we're trading into a fair value gap, and also here we're trading above a high. So, that in itself again is another crack in correlation, right? So, in order, but in order for us to see a reversal, there is something that we must see occur on the lower time frame before, which is either the formation of a precision swing point, then sequential SMT, or sequential CMT followed by a precision swing point, right? That's what we're looking for.
And now we'll talk about this right here. These three last candles. So, the last three candles that, you know, we were referencing to would be the first would be this green shaded area below here, this blue shaded area here, and the third would be this large expansive move. Looking back at the last three candles, this is for Bitcoin, and this is for Ethereum. You can see that the second to last candle, right? At the second to last candle, there was a crap in correlation which occurred here between the closers of the candles in this particular week. Whatever you have candles close like this, and immense amount of liquidity will rest below and above. This is not a precision swing point. This is a position candle, right? Price traded below this candle, expanded, and here price traded below this candle and this one as well, which is where we got SMT and then expanded upwards as well.
So, looking back here, this is how it would look, right? On the lower time frame. You guys remember the entry pattern that we talked about, right? You guys remember, right? Where we have price broke above this high, which caused the actual shift in market structure, traded back down, could not fill this gap here. Price filled this gap, and then price, right, was allowed to run higher before allowing price to be reversed. We need to see C C franch between at least, and this is, you know, very important, between at least the monthly cycle. So, before seeing anything, you know, that would make sense to us, we need to see consolidation such as that we had here. So, we need to see price, you know, drop, go higher, drop, go higher, just like we had price ranging here. Why is that? That's because even though sometimes you'll have expansion and you don't know when it will end, right? It's easy to know when it will begin, right? Because it always begins after you have consolidation. And there is always a pattern that occurs after you have the consolidation as well, which is the sequential MT. You cannot have sequences in T occur after expansion. It must occur after consolidation.
Right here, we are looking at the FX triad. It's pretty obvious the draw liquidity is this high, right? First draw liquidity for the dollar, this high, and then the second is this high right here. We've been talking about it since price was around this area. Why did we expect price to go this high? We had sequentialism here, and we had a lower time frame sequential here as well, right? Also, on this time frame, you can still see the CC sequence. Here we had hidden sequence where we had the closure below this, but here we had this closure below this one, right? Which will form a hidden failure swing. So, for next week, we can expect to see the weekly candle close down for the euro and up for the dollar index, right? It's usually easier to navigate markets like this, you know, since we have, you know, the consolidation here, down in deep discount, here high in the premium, and here we had price in premium as well. But it's still, you know, able to navigate price right here, right? Next draw this low.
And here is, you know, our favorite market, the futures market. More specifically, the index, the index futures market. So, here we had sequence T in regards to doubling theory, right? Between the months of theory, we had sequence T. We talked about this before. Precision swing point, price ran higher, T position swing point, price went higher, sequence T, position swing point, and price ran higher. So, the first, you know, sign that, you know, we might, you know, see price fall back within, you know, this area, which is something that we should look forward to, right? As long as we have safe here to at least days of the week next week. Right here, we had this position candle right here. The thing with position candles is that, right? Whenever they occur, they usually usually occur before the reversal, right? That's what usually happens. So, we're above all-time highs, right? We need to see sequence MT, then we can expect price to fall back within the range. And once that happens, if we see another one, then we expect these lows to be taken out. They're too clean. NASDAQ as well, they're too clean. Whenever you see something like this happen, right? And of course, you need to see consolidation first before the reversal. Of course, that's just how price works. When you see something like this happen, like price leave these clean lows, just as how it left these highs right here, it will usually return to, you know, that pool of liquidity.
And here we're looking, we're taking a closer look at what occurred, right? As you guys can see, the low of the week was caused by what? Sequential symmetry. But something else that you realize, every time we have sequences in T, you know, in this form, whether it's just regular sequence T or hidden market sequences in T, when the low forms on Monday for an asset class, what happens? We usually have expansion throughout the entire week, right? So, around here, most importantly, you know, we had the just click on the draw for you. See the new week opening gap. We had consolidation within the new week open gap, and then price just expanded like crazy, right? Though the week was formed by sequence, that's how it will always be, right?
So, yes, I hope you found this useful. Next week, we should have better market conditions. We should have, you know, not, you know, more volatility, but better volatility, better trades as well, because, as you guys can see, we barely had any, you know, entries. So, here when I was, you know, letting you guys know that I expect higher prices, you would just have to, you know, just buy here and put your low below below the week, right? Usually, that's what it is because sometimes you don't really have an entry. Right? Week, usually like here, the low week forms once you are within a new opening gap. Here, you know, you can consider that as a gap, and then you can expect price to run higher, as how it did.
So, I hope you found this useful. Next week, we should have more to talk about, and the weeks to come should be cleaner and easier for us to understand. That being said, good luck and good trading. See you next time.