Speaker A
Evening, folks. Welcome back. So, you probably watched the little execution I did via my phone this morning. I was laying around thinking, let's just get in here and do something.
Detailed trade analysis of NQ price action using Smart Money Concepts and order flow on a smartphone execution.
Key Takeaways
- Timing trades around key market open windows increases probability of success.
- Inversion fair value gaps require a candlestick close beyond the gap to be valid, unlike order blocks.
- Smart Money Concepts such as buy/sell side liquidity and breakers help identify low-risk trade entries.
- Trade management includes scaling in/out positions based on price action confirmation.
- Mobile trading can be effective with proper framework and discipline.
Summary
- The video reviews a live trade execution on the NQ futures market using Smart Money Concepts and price action analysis.
- Key price levels such as relative equal highs and lows during the London session are identified as liquidity zones.
- The presenter explains the importance of timing trades around 6 a.m. to 9 a.m. pre-session for higher probability moves.
- Concepts like buy side and sell side liquidity, inversion fair value gaps, volume imbalances, and breakers are discussed.
- The video emphasizes the difference between order blocks and inversion fair value gaps, highlighting the need for a close to validate gaps.
- Trade entries and exits are shown with contract sizing adjustments based on price reaction to liquidity pools and fair value gaps.
- The presenter shares insights on market structure phases including accumulation, distribution, and reaccumulation.
- Execution was done entirely on a smartphone, demonstrating practical mobile trading.
- The video concludes with a shoutout to a fellow trader and a reminder to be cautious around all-time highs and liquidity draws.
- Overall, the video provides a comprehensive walkthrough of a low-risk, smart money reversal trade setup.
Chapters
- 00:00Introduction and Trade Setup Overview
- 00:30Framework and Backbone of Trade Execution
- 00:58Experiment and Price Action Analysis
- 01:26Timing and Market Session Considerations
- 01:52Identifying Buy and Sell Side Liquidity
- 02:28Inversion Fair Value Gaps and Order Flow Concepts
- 04:47Trade Entries, Position Management, and Exits
- 06:52Market Structure and Final Trade Review
- 07:32Shoutout and Closing Remarks
Full Transcript — Download SRT & Markdown
Speaker A
So, I was trading the NQ, and I'm going to go over the salient points as to what I was using and what I saw in price action. It's a little bit easier to see it on the large screen like this, but I
Speaker A
promise you everything that I'm going to highlight here was the backbone and framework for everything that I did in the execution. So, let's take a quick look at it real quick.
Speaker A
Pause the video and study what you think you see. Okay? When you're done and you think you've annotated everything that was salient to this price run, unpause the video and then compare and contrast what I show you in my annotations and what
Speaker A
was used for the trade. All right, so if you haven't paused, it's getting ready to ruin the whole experiment for you.
Speaker A
Relative equal highs formed during the London session. At 5:00 a.m., we roll over into dead time between 5:00 a.m. and 6:00 a.m. There can be price runs, but we're looking for 6 a.m. start time. Okay, so 6 a.m. is
Speaker A
the earliest that, I guess, the higher probability price runs can be trusted. And then obviously we go into 7:00 to 9:00 pre-session time.
Speaker A
Okay. So, that starts the clock at six right there. Okay. And then to 7.
Speaker A
There's seven. Okay. So, inside that little window, there can be a price run that can materialize in price. And I'm looking for those types of things, especially on non-farm payroll weeks because I want to be in there like the
Speaker A
old adage says, the early bird gets the worm, which is why I titled it today, Early Bird. So this buy side in here, the highest high is this one right there. And we have sell side here. And we have relative
Speaker A
equal lows there. Okay. And then convenient how it ran up above, taking that buy side.
Speaker A
We broke down, traded down into that low there, clearing out that area. So buy side taken first, then sell side. Okay. So let's add the lipstick real quick so that way the video isn't too long.
Speaker A
Right. So there's that. So the buy side look right there. The market rallies up and then we have one more rally higher.
Speaker A
So, it's a slightly higher high, and then we start the macro. So, 5:50 a.m. macro time. What should we expect? We've taken buy side. Where is it? Smooth here. We have a minor sell-side liquidity pool there. And we have relative equal lows
Speaker A
there. So, we ran buy side. We have an inversion fair value gap right here between this candlestick's high, this candlestick's low. We gap down with a volume imbalance. We trade up to consequent encouragement here and sell off during the macro. We have a breaker
Speaker A
which is a high low, higher high that body dragged through. You can see we trade up into that. Then the market starts to trade lower and then right here on this candle, see what we did there? We have a candlestick close
Speaker A
outside of this buy side bounce side efficiency, which validates this becoming an inversion fair value gap.
Speaker A
This is not validating it. It's just wicking down through it. We want to see it trade down. This is Michael's Smart Money Concepts order flow concept. Not some just because it went below here.
Speaker A
We're not doing order block. Okay. Order block does not require a close. Inver gaps require the close. Okay, so put that in your notes because if not, you'll forget it. I promise you. And then the rally up, we stop in the upper quadrant
Speaker A
of this base deficiency. And then we aggressively leave the range. And then right in here, I saw that gap and I wanted to be a part of the move. So, I threw in a small position with just simply two contracts anticipating the
Speaker A
likelihood of trading back up into the low of this inversion fair value gap, and then we had this sell side bounce, buy side efficiency here, which I have highlighted with these two little trend lines. So, as it went into that, then it
Speaker A
added the lines portion of the position I wanted to assume. Then we break lower aggressively. We take out minor sell side. I took partial there and then back up into consequent encroachment there. And I added those two contracts I took off below here.
Speaker A
Added them right back on. Pretty neat, huh? I got lucky. Don't worry. And then the market rallies lower and then we attack the minor sell side there. We breach that and then we aim for that once it went through it. And
Speaker A
then I added another exit as it went through. And then finally traded down below the relative equal lows there. So if you look at it, okay, if you look at it real, real closely, you'll see original consolidation, first stage accumulation,
Speaker A
and sometimes a fast move doesn't have second stage reaccumulation. So it can be just one and then done.
Speaker A
Smart money reversal, low-risk sell, first stage distribution, second stage redistribution, and then the biggest move takes place there, clearing the relative equal lows, original consolidation, and then just for extra measure, targeting the terminus objective I had. And I know
Speaker A
it's not on here. So, let's put them on there now. Here's the executions.
Speaker A
There's the business there. And you can see here's the first entry with the two contracts, rated at consequent encouragement with that little inversion fair value gap I was anticipating.
Speaker A
And then we have distribution of all this run up in here. I'm getting inside that. So I'm adding more positions inside this. It broke lower, partial right below that low there, and then it rallied up and I went short
Speaker A
there. Well, I'm not going to be able to show it, am I? 544.75. So, that was right there. Right there is where the fill is. So, not bad. Close enough for government work, right? We trade lower, then back up into the fair value gap.
Speaker A
It's bearish. Then we sell off precipitously, taking out that low. You can see that fill is right there. And then targeting that. All done on a smartphone. The smartphone lounging in the house with pajamas still on and then the
Speaker A
relative lows there finally clipping that there and then wouldn't you know it on my exit candle it reversed right there. That's crazy, right? That's crazy. Work side of balance, side of efficiency, don't forget your little volume bounce and
Speaker A
then rally up and back in here. Shout out to Dasha over at Lumi Traders. I ducked in real quick and told her to prepare for new all-time highs. She was asking me some questions about the
Speaker A
technicals, and lo and behold, the market does in fact up into our all-time high.
Speaker A
Used it there and then we swept it once more later in the portion of the day. And now where we're at here in Asia, we're working around that old all-time high. So, relative equal highs, be mindful of that. They'll probably
Speaker A
utilize that as a next draw in liquidity. Try not to pick the tops. Until talk to you next time, wish you good luck and good trading.
Topics:NQ tradingSmart Money Conceptsorder flowinversion fair value gapliquidity poolsprice actionfutures tradingtrade executionmobile tradingmarket structure
