Speaker A
All right, folks, welcome back. This is episode 29. I'm going to be doing a brief review of what took place today.
Episode 29 review of Nasdaq and S&P trading with bullish bias, market structure, fair value gaps, and upcoming Fed volatility insights.
Key Takeaways
- Bullish bias was justified based on market structure and intermarket analysis between Nasdaq and S&P.
- Low volatility days require experience and caution, especially ahead of major economic events like Fed speeches.
- Fair value gaps and relative highs/lows are critical tools for identifying trade entries and market shifts.
- Smart Money Technique (SMT) offers a non-indicator approach to understanding market dynamics.
- Close proximity entries are acceptable when ideal trade setups are missed, emphasizing trade management.
Summary
- The video is a review of trading activity on May 16, 2022, focusing on Nasdaq and S&P with a bullish bias.
- The presenter highlights the importance of the 12,553.25 level on Nasdaq as a key resistance point.
- Discussion of low volatility day ahead of Fed Chair Powell's speech and retail sales data release on May 17, 2022.
- Explanation of market structure concepts including relative equal highs/lows, fair value gaps, and short-term swing lows.
- Use of intermarket relationships between Nasdaq and S&P to identify divergences and validate trade bias.
- Introduction of the Smart Money Technique (SMT) to analyze market behavior without traditional indicators.
- Detailed analysis of price action on a one-minute chart, focusing on entry points near fair value gaps.
- Emphasis on close proximity entries and managing trades when ideal entry points are missed.
- Clarification on the use of demo trading and live data to prove trading concepts without rented MT4 servers.
- Technical explanation of recording software and video editing process used for the tutorial.
Full Transcript — Download SRT & Markdown
Speaker A
I obviously executed today. I wasn't planning on doing two videos, but uh obviously by the comments, some people are a little bit confused.
Speaker A
So, I kind of like want to bring your attention back to that 12,553 and a quarter level, which is the relative equal highs here on Nasdaq.
Speaker A
So, that was kind of like the basis for why I went into the market today, Monday, the 16th of May, 2022, with a bullish bias.
Speaker A
I was looking for this draw on liquidity still for Nasdaq.
Speaker A
I originally went in looking for a trade in Nasdaq, but
Speaker A
All right, and the S&P, much like the Nasdaq, had a daily swing low.
Speaker A
And while we didn't have relative equal highs here for S&P, the bias was, in my opinion, warranted for at least the beginning of the week.
Speaker A
Looking for continuation on the upside.
Speaker A
Before I get into it, tomorrow, which is Tuesday, May 17, 2022, 8:30 in the morning, New York local time.
Speaker A
We have retail sales numbers and then 2:00 in the afternoon, New York local time.
Speaker A
We have the Fed chairman speaking.
Speaker A
So, there's going to be all kinds of volatility at 2:00 tomorrow.
Speaker A
That's the reason why the market was kind of like lethargic today.
Speaker A
But I wanted to kind of like showcase something.
Speaker A
So, today I kind of like wanted to put a nail in the coffin finally about this whole business about
Speaker A
rented MT4 servers, okay?
Speaker A
I'm never going to bring the conversation up again or the topic again.
Speaker A
I think everyone knows now by seeing what I've done here, just in a short span of time.
Speaker A
If I did this for another five, six weeks, you could clearly see that it's not impossible for the same things I was doing on Twitter.
Speaker A
Years and years ago, okay, with MT4, I'm not using MT4 here.
Speaker A
I can't game this system, I'm using live data.
Speaker A
You're watching the execute, it is what it is, folks, okay?
Speaker A
Now, it's paper trading, it's demo trading, but I do it just to prove that I can read this stuff.
Speaker A
I'm not trying to beat my chest, I'm not trying to brag, but I just want to finally put this to bed.
Speaker A
Because it's still, you see people talking about it all the time.
Speaker A
When they do that kind of talking, you take them back to these videos here.
Speaker A
You link these videos to them and let them chew on that.
Speaker A
All right, so we have the one-minute chart.
Speaker A
I'm going right into the one-minute chart because we're starting with a bullish bias.
Speaker A
And at 9:30, we see the market does, in fact, take out a short-term high.
Speaker A
It declines.
Speaker A
I'm not interested in going short.
Speaker A
It does not give me a pattern anyway.
Speaker A
Notice that there's no fair value gap revisited.
Speaker A
The market creates this relative equal low, starts to rally.
Speaker A
Trades up into the afternoon in here.
Speaker A
I want to see it create a buying opportunity.
Speaker A
Now, the logic behind all this is
Speaker A
we're in a day before Fed chair speaks.
Speaker A
So, there's going to be very low volatility as a result of that.
Speaker A
So, it's going to be a small range day.
Speaker A
Doesn't mean you can't trade it, obviously.
Speaker A
But it takes a little bit more experience.
Speaker A
Now, I'm not saying that you should trade ahead of Fed chair Powell speaking or any future Fed chairman.
Speaker A
Because it's going to be a very quiet day, usually like this, okay?
Speaker A
And it's important to know when the volatility is likely to occur and when also the volatility is likely to shrink up and get kind of like lethargic.
Speaker A
If you look at the S&P at the top, you can see the drop down.
Speaker A
Relative equal lows, and then we have the same similar pattern here, but look what Nasdaq was doing.
Speaker A
You see that?
Speaker A
Lower low when S&P was saying, I don't want to go that low.
Speaker A
So, it was resisting going lower.
Speaker A
Then we retraced higher, just like this Nasdaq did.
Speaker A
But then Nasdaq made a lower low than that of 10:00 in the morning.
Speaker A
While at the same time, the S&P said, no, once again, I'm not going lower than the low I made at 10:00.
Speaker A
So, we had a divergence here and here.
Speaker A
No indicators, folks.
Speaker A
I'm using intermarket relationships and this is what I dub SMT, Smart Money Technique or Smart Money Tool.
Speaker A
Now, the importance of that is
Speaker A
I already had a bias that's bullish.
Speaker A
There was no short trades that were lined up with this model today.
Speaker A
There was no interest in wanting to be short.
Speaker A
I want to focus on being long.
Speaker A
So, we're in the one-minute chart here.
Speaker A
And I want you to take a look at what we have framework-wise.
Speaker A
Obviously, you've probably already seen the short video I compressed today.
Speaker A
But looking at price action like this, yes, you can see there is a rally up.
Speaker A
It breaks this short-term low, a fair value gap, it trades up into it and breaks down.
Speaker A
Big deal.
Speaker A
This doesn't fit the criteria because the displacement leg here would require us to see a fair value gap above 50% of the high and the low of the displacement leg.
Speaker A
And we don't have that.
Speaker A
So, nothing here fits the model for a short.
Speaker A
But watch what happens.
Speaker A
The market creates a run on sell stops here, then rallies.
Speaker A
Retraces back down into a fair value gap.
Speaker A
I've seen this happening, but I was trying to get the recording software that I use.
Speaker A
And by the way, let me just throw this in here too, because I see people asking.
Speaker A
My website address as a watermark.
Speaker A
TradingView doesn't do that.
Speaker A
Okay, I use my Camtasia recording software that helps me do these videos.
Speaker A
Uh, it's just an application you can overlay like a like a text.
Speaker A
Call out, they call it.
Speaker A
And that's what it is, so it's really when I'm doing the recording talking.
Speaker A
There is nothing here.
Speaker A
It's a it's a blank chart.
Speaker A
And then at the end of the recording, when I'm editing it, I'll just add in my website address and
Speaker A
So anyway, with that said.
Speaker A
We've seen the market trade back down in and I was trying to get the Camtasia Studio to open up.
Speaker A
And sometimes it doesn't open up and give me what I need, so I have to close it down entirely and restart it.
Speaker A
And the whole time this candle was doing its business.
Speaker A
And I wanted to see it return into this fair value gap once more.
Speaker A
And I got in on this candle here.
Speaker A
And we'll look at the relationship between
Speaker A
the Nasdaq, which was a little bit sloppier in here.
Speaker A
Versus the S&P.
Speaker A
A little bit more structured here.
Speaker A
So, the fair value gap in here, this candle in here.
Speaker A
It retraced down into it.
Speaker A
And I want to get close to this fair value gap without it running too far away.
Speaker A
So, I kind of like want to touch you a little bit tonight with close proximity entries.
Speaker A
That means you might not get so precise with your entries.
Speaker A
You might fumble with your order entry or something might happen like it happened with me.
Speaker A
I I wanted to record me entering, not just simply say, here, here's a trade I took.
Speaker A
So, I wanted to show obviously me getting in.
Speaker A
Putting the stop, managing the position and adding the second position in here.
Speaker A
What do you do in this situation if you miss the ideal entry?
Speaker A
Well, as long as you're getting in there really close or like I'm suggesting here, a close proximity entry.
Speaker A
I don't think there's anything wrong with it.
Speaker A
So, if we are looking for entry patterns.
Speaker A
The idea is we want to get into where our model is suggesting it.
Speaker A
So, we're seeing the market trade lower, lower, lower, it's failing to make a lower low like Nasdaq.
Speaker A
And we have this low that's probably not going to be taken out because we're bullish.
Speaker A
The market rallies up.
Speaker A
We have a short-term shift in market structure.
Speaker A
Then it trades back down into the fair value gap.
Speaker A
Look how many opportunities it gave to go long.
Speaker A
One, two, three, four, five, six, seven, eight.
Speaker A
Eight candles, it gave an opportunity to get in this area here.
Speaker A
Either inside the fair value gap or in close proximity to it.
Speaker A
Now, when the market starts to rally.
Speaker A
I have one more indication that the market structure has shifted again, bullish.
Speaker A
With these highs taken out here.
Speaker A
And then I had a small little fair value gap there.
Speaker A
And then you watch me add more.
Speaker A
A limit order came in.
Speaker A
Filled it.
Speaker A
I only had one and a half, or no, I'm sorry, one and three-quarters handles.
Speaker A
Okay, seven ticks if you want to think of it like that.
Speaker A
I had seven ticks of heat against me on this little candle here before it started running in my favor.
Speaker A
I took the full pull off here.
Speaker A
And I did not get the highest high.
Speaker A
I was a little disappointed in that regard.
Speaker A
But uh the the candle obviously hit it there.
Speaker A
And we'll go over to TradingView and we'll look at the business.
Speaker A
All right, we're over here on TradingView.
Speaker A
This is live, you can see.
Speaker A
Time of that's recording, this is where I'm sitting down at the computer.
Speaker A
And the market trades lower, creates that short-term run here.
Speaker A
Rallies.
Speaker A
Breaking market structure to the upside.
Speaker A
Trades into the fair value gap and the secondary fair value gap.
Speaker A
And then it runs up into the liquidity above here.
Speaker A
Now, if I add
Speaker A
the executions.
Speaker A
I want you to see look right in here and right in here.
Speaker A
And up here where you'll see the exits and entries.
Speaker A
Respectively.
Speaker A
So, you can see there's that candle.
Speaker A
That entry.
Speaker A
3,994 and a half.
Speaker A
3,996 and a quarter.
Speaker A
And it went down to 94.
Speaker A
What's the low here?
Speaker A
Yeah, 94 and a half.
Speaker A
So, it was only less than two uh handles, or no, less than one.
Speaker A
Yeah, less than one.
Speaker A
Less than one uh handle of heat entering on this candle here.
Speaker A
And the next candle had a little bit of retracement.
Speaker A
So, very, very, very tight placement.
Speaker A
And this was not entering in the fair value gap, it was in close proximity to it.
Speaker A
So, the underlying idea was it was going down in here to go higher.
Speaker A
Retrace into that to go higher.
Speaker A
And you saw me map out all this stuff here.
Speaker A
And call it up in, you know, business is done.
Speaker A
But the exit up here.
Speaker A
4,022 and a half.
Speaker A
And that's that.
Speaker A
You can see there is no short positions in here.
Speaker A
No short positions over here, none of that business.
Speaker A
And on Nasdaq, we'll pull that up just for completeness sake too.
Speaker A
No executions.
Speaker A
So, all the business was done in the S&P today.
Speaker A
So, my question to you is, when you see these videos and
Speaker A
I'm trying to illustrate, obviously, that I don't need to fraud anyone.
Speaker A
The things I'm teaching you, I think that you're seeing evidence that it works.
Speaker A
Hopefully, uh you guys have seen enough with this here.
Speaker A
Um, do the math, folks, okay?
Speaker A
In less than a week and a half, how much more would you see this compound if I did it for six more weeks?
Speaker A
Or five weeks?
Speaker A
It's hard to imagine the things that I did on Twitter with MT4.
Speaker A
Not a rented MT4 server.
Speaker A
Literally pushing a button, putting the orders in, doing the whole business, okay?
Speaker A
I know a lot of you have just discovered me and you're seeing people post stuff about how other traders or other mentors or other teachers.
Speaker A
They fake their positions.
Speaker A
I'm open about paper trading because it's compliance.
Speaker A
I'm not legally allowed to give you trade advice.
Speaker A
So, I'm protected by my discussion in paper trading because you cannot make money with paper trades.
Speaker A
And you can't lose money with paper trades.
Speaker A
But I've always said this from the beginning, I've dubbed myself the demo baller.
Speaker A
I championed that name because I want to make sure everyone knows that I'm not promising you profitability.
Speaker A
I don't dangle a carrot in front of you and saying you're going to do what I'm doing here.
Speaker A
Because you're not going to be able to replicate this.
Speaker A
You're not, okay?
Speaker A
Don't be deceived by seeing me do this again for like the fifth time.
Speaker A
Running up an account like this with breakneck speed velocity.
Speaker A
And this is just casually doing it in a tight range.
Speaker A
When there's large ranges, I could have easily taken this over to a million dollars.
Speaker A
Already.
Speaker A
But it doesn't prove anything.
Speaker A
Except for the fact that I can read price action.
Speaker A
That's all.
Speaker A
That's all I'm showcasing.
Speaker A
I'm not trying to say I'm the best.
Speaker A
I'm not trying to say that you can't make money in other things.
Speaker A
I'm just saying.
Speaker A
I know how to read these candlesticks, I know what they're likely to do.
Speaker A
Most of the time before they do it.
Speaker A
I know at times I take losing trades.
Speaker A
But when it's really likely to work with the algorithm.
Speaker A
I'll be dialed in.
Speaker A
You can't fake what I'm doing.
Speaker A
You can see me executing the trade, you can see me managing the trade.
Speaker A
And you can see the orders entering and filling.
Speaker A
They pop up, they verify the whole thing.
Speaker A
No replay button appear.
Speaker A
None of this stuff, okay?
Speaker A
See how that's blue now?
Speaker A
Like you can't create that same scenario.
Speaker A
So, I'm hopefully satisfying this discussion that people like to bring up all the time.
Speaker A
About rented MT4 servers because they couldn't wait to put that on me.
Speaker A
Because they watched me do just like this and I ran up to $5 million in a little less than one and a half months.
Speaker A
Okay, so.
Speaker A
I understand that doesn't seem possible.
Speaker A
I understand that people that would be able to do what I'm doing could very easily go out there and defraud people.
Speaker A
I'm telling you it's demo.
Speaker A
I'm not saying that I did that with real money.
Speaker A
I'm just saying that I can read price action.
Speaker A
I can see these patterns forming and even with these other folks out there.
Speaker A
With fake MT4 servers and MT4 screenshots of making money and all this other fake withdrawals.
Speaker A
I made fun of all that stuff.
Speaker A
I trolled those people on Twitter.
Speaker A
Now, I'm about to go back to Twitter.
Speaker A
This time, I'm not going there with that intent.
Speaker A
I'm ready, should someone want to bring it.
Speaker A
But I'm not there or going there for that reason.
Speaker A
The reason why I'm going to Twitter is I miss being able to do my small little vignettes.
Speaker A
Where I would do recordings of me either taking a trade or reading price action and having some short little clip.
Speaker A
40 seconds long or less of music in the background.
Speaker A
I missed doing that.
Speaker A
Maybe it wasn't always your cup of tea for my music choice, but I have a very diverse palette for music.
Speaker A
And it's just one of those things I enjoyed doing.
Speaker A
So, it might not be worth it for you to follow me on Twitter.
Speaker A
Or it might be, I don't know.
Speaker A
But I kind of wanted to clear the air for the last time.
Speaker A
And show you all one more time where I don't need to do what what frauds do.
Speaker A
Like I can I can see this stuff before it happens.
Speaker A
And you can learn how to do this too.
Speaker A
You can read it before it happens, you can see it, you can have faith that.
Speaker A
The things that you're learning here are rooted on sound logic.
Speaker A
It's not randomness.
Speaker A
It's not retail logic.
Speaker A
These are things that are algorithmic.
Speaker A
And I think today was a testimony to that.
Speaker A
So.
Speaker A
Tomorrow's going to be very volatile.
Speaker A
Be careful, do not try to trade tomorrow.
Speaker A
You'll probably hurt yourself if you do.
Speaker A
Or don't listen to me and learn the lesson the hard way.
Speaker A
Until I talk to you next time.
Speaker A
Be safe.
Topics:Nasdaq tradingS&P 500bullish biasmarket structurefair value gapSmart Money Techniqueintermarket analysisFed speech volatilityday tradingtrading review
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