Showing posts sorted by relevance for query stacey burke. Sort by date Show all posts
Showing posts sorted by relevance for query stacey burke. Sort by date Show all posts

Monday, January 9, 2023

External & Internal Range Liquidity | Auction Process & Institutional Order Flow

External Range Liquidity is the liquidity that will be resting on previous highs and lows (these highs and lows are also used to define the range), this could be in the form of stops or pending orders. While Internal Range Liquidity is the liquidity inside the defined range (External Range Liquidity). This could be in form of any institutional reference that we can use as entry such as order blocks, fair value gaps, volume imbalance, and more.

HERE

The first thing to do to be able to identify external range liquidity and internal range liquidity is to define the range you will be working within, using swing highs and lows to mark the beginning and end of the range. Choose the recent trading range relative to your specific time frame when defining your range.

External Range Liquidity can act as a draw on liquidity based on order flow, meaning if we have external range liquidity on the previous low and the institutional order flow is bearish, price will be attracted or pulled towards our external range.
 
 
There are only three things price can do:
1. Breakout from a Range and Trend.
2. Breakout from a Range and Reverse (False Breakout or Stop Hunt).
3. Trading Range between Highs and Lows of sessions, days, weeks, months, quarters, years.
HERE
 
Crude Oil ranges to break:
Inside Session, Inside Day, Inside Week, Inside Month, Inside Quarter, Inside Year.
 
The Marker Makers Cyclic and Fractal Price Auction Process is mirrored in Price Action:
Expansion is when Price moves quickly from a level of Equilibrium (50% of range).
Retracement is when Price moves back inside the recently created Price Range.
Market Makers look to reprice levels of imbalances that were not efficiently traded.
Reversal is when Price moves the opposite direction that current direction has taken it.
Market Makers have ran a level of Stops and a significant move should unfold in the new direction.
Liquidity Pools are just above an old Price High and just below an old Price Low.
Consolidation is when Price moves inside a clear trading range and shows no willingness to move
significantly higher or lower. Expect a new Expansion near term.
 
See also:

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Wednesday, April 5, 2023

ICT Weekly Range Profiles | Michael J. Huddleston

 
 
 
These profiles are conceptual models that describe typical patterns in how prices might behave during a trading week. Each profile has unique characteristics that can guide traders in anticipating potential market movements. However, it’s important to note that these profiles are not rigid predictions but rather frameworks to understand market tendencies. 
 
The weekly price movement in financial markets follows a recurring pattern of consolidation, expansion, reversal, expansion again, consolidation, and a potential reverse or retracement:
  1. Sunday Open Consolidation: The week often begins with price consolidation on the Sunday open, reflecting a cautious approach as traders assess the weekend developments.
  2. Monday Expansion: As the trading week gains momentum, Monday is typically marked by an expansion phase. This reflects increased activity and movement as traders react to new information.
  3. Tuesday Reversal: The following day, Tuesday, often witnesses a reversal in price trends. This can be attributed to traders reassessing their positions after the initial expansion phase.
  4. Wednesday Expansion: Midweek, the market tends to experience another expansion phase. This reflects a renewed bout of activity and movement in response to evolving market dynamics.
  5. Thursday Consolidation: On Thursday, there’s often a consolidation phase. Price ranges may narrow as traders assess the overall sentiment and prepare for the end of the trading week.
  6. Midweek Friday Reverse or Retrace: As the week approaches its close, Friday may see a reversal or retracement in trends. Traders might adjust their positions before the weekend, leading to a shift in price direction.

This weekly cycle reflects the rhythm of market sentiment and participant actions throughout the trading week.
 
 
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Monday, May 20, 2024

The 8 Most Common Chart Patterns | Aksel Kibar

I've simplified classical chart patterns to the most basic/common 8 patterns. I think most new patterns are derived from those basic ones. Our brains' pattern recognition is not that advanced to focus on so many derivatives. In fact better success can be achieved by narrowing down the below to select few.
 
 These patterns are identical on all time frames. 

The symmetrical triangle, the descending triangle and the ascending triangle.
 
There are three types of triangles covered under the classical charting principles. The symmetrical triangle, ascending triangle and descending triangle. Between those three I favor ascending and descending triangles for couple of reasons. One of them is, both ascending and descending triangles have horizontal boundaries. Breakouts through the horizontal boundaries are the chart pattern signal. The other reason is that, both ascending and descending triangles have directional bias due to their upward and downward sloping lower and upper boundaries. I find symmetrical triangles difficult to trade as price usually finds resistance at the minor highs following the breakout. Pause around minor resistance usually hampers the momentum and can result in more frequent failures. A symmetrical triangle has both boundaries converging towards an apex. It is a neutral chart pattern and doesn’t have a directional bias.
 

Type 1 Breakout = Breakout without any Re-Test or Pullback.
Type 2 Breakout = Breakout with a Re-Test or Pullback.
Type 3 Breakout = Breakout followed by hard Re-Test of Pattern Boundary.
Type 4 Breakout = Failed Breakout  - Price fails to continue in the breakout's direction and instead reverses. 
 
 
 
 
 
Breakout Type 1, Type 2, and Type 3 Summary.
 
 Head & Shoulder Top Failure acting as Bullish Continuation.

The latest stats on pattern reliability: Rectangle continues to lead. With good risk management Type 1 & Type 2 breakouts offered 48.6% of all ideas to offer edge with pattern signals.


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Sunday, May 28, 2023

Trading the Pump & Dump Pattern | Cameron Benson

I'm going to show you that pattern that I use every single day on every single trade, whether I'm going long or short. The pattern that I'm referring to is the pump & dump and the dump & pump pattern. Every single market movement is either a pump & dump or a dump & pump pattern, and all trade setups are based on these two patterns.
 
 
Markets are fractal, and this pattern is going to occur on the weekly and the daily time frame, on the 4 hour, the 15-minute, the 30 second chart, etc. It doesn't matter: whatever you're looking at, this pattern is going to occur.


I use larger setups and then I start to break things down: I look at the date and day in the month, I look at the three-week cycle, at the three-day cycle, at what day are we in the week, and I look at the weekly range, what is the high and the low of the week. Are we working the low, are we working the high? 
 

Any unidirectional move – up or down - ends with a consolidation, followed by a break in market structure and a continuation to anther pivot level and/or it is followed by a reversal.
 
 
Three pushes to a high, a sideways consolidation, a break in market structure to the downside, then the dump. A lot of times the market will return down at least to the 50% retracement level or down to the level where the pump started or even below.


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Friday, December 1, 2023

Weekly Opening Range Breakouts & Daily Range As Multiple Of Asian Range

 
Reference:
Stacey Burke (2023) - Trading Inside or Outside the Daily and Weekly Range.
TPR (2023) - The Weekly Opening Range & ICT Weekly Range Profiles.
 
 The ICT 2022 Mentorship Trading Strategy.
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Saturday, February 17, 2024

Forecaster BS │ Robert Miner

 » Learn to trade, ignore forecasters. «
 
'Forecasts' and 'signals' are useless without strategies and setups. A setup includes timing and levels for entry, exit, stop-loss, and position sizing in line with risk-management. This is what Robert Miner teaches in his books. Understand time cycles, price action, that price is always timed and measured; order flow, accumulation, manipulation and distribution (AMD/Power of 3); trend, trend reversal and trend continuation; time of day/week/month/quarter and risk/reward. Then develop 'signals' and strategies. Back-test. Learn to trade, ignore forecaster BS. 
 
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Friday, December 16, 2022

The Four Guiding Principles of Market Behavior | Momentum & Trend

Principle 1:     Trend is More Likely to Continue its Direction than to Reverse
With price established in a clearly defined trend of higher highs and higher lows, certain key strategies and probabilities begin to take shape. Once a trend is established, it takes considerable force and capitalization to turn the tide. Fading a trend is generally a low-probability endeavor and the greatest profits can be made by entering reactions or retracements following a counter trend move and playing for either the most recent swing high or a certain target just beyond the most recent swing high. An absence of chart patterns or swings implies trend continuation until both a higher high and a higher low (vice versa for uptrend changes) form and price takes out the most recent higher high.

Be aware that recent statistical analysis of market action (from intraday to 20 day periods) over the last five years shows that mean reversion, rather than trend continuation is more probable in many equities/indices (as shown by more up days followed by down days than continuation upwards). For the current market environment, until volatility returns (as it may be doing now), this rule may be restated, “Trends with strong momentum show favorable odds for continuation.”
 
Principle 2:     Trends End in Climax (Euphoria/Capitulation)
Trends continue in push/pull fashion until some external force exerts convincing pressure on the system, be it in the form of sharply increased volume or volatility. This typically occurs when we experience extreme continuity of thought and euphoria of the mass public (that price will continue upwards forever). However, price action – because of extreme emotions – tends to carry further than most traders anticipate, and anticipating reversals still can be financially dangerous. In fact, some price action becomes so parabolic in the end stage that up to 70% of the gains come in the final 20% of the move. Markets also rarely change trends overnight; rather, a sideways trend or consolidation is more likely to occur before rolling over into a new downtrend.
 
Three Things Markets do:
1. Breakout and Trend.
2. Breakout and Reverse (False Breakout).
3. Trading Range (High and Low).		 
 
Principle 3:     Momentum Precedes Price
Momentum – force of buying/selling pressure – leads price in that new momentum highs have higher probability of resulting in a new price high following the next reaction against that momentum high. Stated differently, expect a new price high following a new momentum high reading on momentum indicators (including MACD, momentum, rate of change). A gap may also serve as a momentum indicator. Some of the highest probability trades occur after the first reaction following a new momentum high in a freshly confirmed trend. Also, be aware that momentum highs following a trend exhaustion point are invalidated by principle #2. Never establish a position in the direction of the original trend following a clear exhaustion point.
 
Principle 4:     Price Alternates Between Range Expansion and Range Contraction
Price tends to consolidate (trend sideways) much more frequently than it expands (breakouts). Consolidation indicates equilibrium points where buyers and sellers are satisfied (efficiency) and expansion indicates disequilibrium and imbalance (inefficiency) between buyers and sellers. It is much easier to predict volatility changes than price, as price-directional prediction (breakout) following a low-volatility environment is almost impossible. Though low volatility environments are difficult to predict, they provide some of the best risk/reward trades possible (when you play for a very large target when your initial stop is very small – think NR-7 Bars).

Various strategies can be developed that take advantages of these principles. In fact, almost all sensible trades base their origin in at least one of these market principles: breakout strategies, retracement strategies, trend trading, momentum trading, swing trading, etc. across all timeframes.
 
Concept Credit for arranging the four principles: 
 
See also:
 
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Sunday, September 25, 2022

Swing Trading - Rules and Philosophy | Linda Bradford-Raschke

Linda Bradford-Raschke (2001) - My style is based on the "Taylor Trading Technique", a short-term method for trading daily price movements that relies entirely on odds and percentages. It is a method as opposed to a system. Very few people can blindly follow a system, though many find it easier to be discretionary in a systematic way. 
 
 

[...] Because of the short-term nature of this technique, swing traders must adhere to some very basic rules, including: 
  • If the trade moves in your favor, carry it overnight--the odds favor follow-through. Expect to exit the next day around the objective point. An overnight gap presents an excellent opportunity to take profits. Concentrating on only one entry or one exit per day relieves the pressure. 
  • If your entry is correct, the market should move favorably almost immediately. It may come back to test and/or exceed your entry point a little, but that's OK. 
  • Do not carry a losing position overnight. Exit and play for better position the next day. 
  • A strong close indicates a strong opening the following day. 
  • If the market doesn't perform as expected, exit on the first reaction. 
  • If the market offers you a windfall of big profits, take them to the bank on the close. 
  • If you are long and the market closes flat, indicating a lower opening the following day, scratch or exit the trade. Play for better position the next day. 
  • It is always OK to scratch a trade! 
  • Use tight stops when swing trading (wider stops when trading trend). 
  • The goal always is to minimize risk and create "Freebies." 
  • When in doubt--get out! You have lost your road map and your game plan! 
  • Place your orders at the market. 
  • When the trade isn't working, exit on the first reaction. ANTICIPATE!
 
Traders Laboratory (2007) - Taylor Trading Technique

How does one anticipate entry? The following may be indicators of a buy day or a sell day:

The Count: Start searching for a buying day 2 days after a swing high or, conversely, a shorting day 2 days after a swing low. Ideally, the market will move in complete 5-day cycles. (In a strong trend, the market will move 4 days in the primary direction and only 1 in reaction. Thus, one must seek entry 1 day earlier.)
 
"Check Mark" on the Test: The potential entry is sought opposite, or contrary to, the previous day's close. If looking to buy (sell), one first wants the market to "test" the previous day's low (high), preferably early in the day, and then form a trading pattern that looks like a "check mark" (see examples). This pattern sets up and establishes a "double stop point" or strong support. If entering a market with only a "single stop point" or support formed by today's low only, exit on the same day--the trade is clearly against the trend.

Close vs. Open: The close should indicate the following day's opening. When a market opens opposite what is expected or indicated by the trend, one may first look to "fade" it--but must take profits quickly. Then look to reverse!

Support (Resistance): Is today's support (resistance) higher or lower than yesterday's?

Swing Measurements: Where is the market relative to the last swing high or low? Look for swings (up or down) of equal length, and for retracements of equal percentage.

No matter in what time frame, always look for supply at tops and support at bottoms. Penetrations should be accompanied by volume and activity. Expect trends, either up or down, to last for either 2 or 4 weeks. The following conditions are fairly reliable indicators for the start of one of these trends (I personally skip the first buy or sell swing when one occurs because the move ensuing could be quite strong): 
  • Narrowest range in the last 7 days 
  • 3 consecutive days with small range
  • The point of a wedge
  • A breakaway gap 
  • A rising ADX (14-period) above 32
Practice: Because a certain amount of confidence in any technique is required to trade it consistently, paper trading can cultivate the faith necessary to recognize and trade pattern repetition. Although the temptation to try too many different styles and patterns always exists, one must strive ultimately to trade in just one consistent manner or at least to integrate techniques into your own unique philosophy.
 
System Characteristics: Certain points about trading short-term swings deserve note. Understanding the nature of short-term systems can help you recognize the psychological aspect of trading. When consistently following a short-term system, you should expect a very high win/loss ratio. Though the objectives with this style of swing trading appear conservative, you will almost always incur "positive slippage". In all systems, winners are skewed. Even though making steady profits, 3-4 really big trades may actually make the month. It is vitally important to always "lock in" your trades. Don't give back profits when short-term trading. You may be astonished at just how big some winners may be from catching the swings "just right!"
 
[...] Finally, I want to leave you with what I believe are two Golden Rules, applicable to all traders but, of essential importance to short-term swing traders: 
  • NEVER, ever, average a loss! Sell out if you think you are wrong. Buy back when you believe you are right.
  • NEVER, NEVER, NEVER listen to anyone else's opinion! Only YOU know when your trade isn't working.
 
See also:
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