<aside> <img src="/icons/reorder_gray.svg" alt="/icons/reorder_gray.svg" width="40px" /> Time and Price for Forex / DXY SMT / Building a narrative /
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Somewhere around London open, we can see there was a Judas swing that starts with a breaker and also purged the BSL. We draw a fib on that price leg, that SD -3, gives you the low of the day.
Usually in FX until New York lunch hour, most of the daily range is typically capped by London close (10am -12am). In ES the range continue beyond that. This is basically the PM session. But in forex there is not much movement in those times. In Forex during London Open (2am-5am) the High of the Day will be created and during London Close, the Low of the Day will be formed.
If we look at the chart above, focus your attention on the last time price touched the low of the breaker, its around 9:50am. That LH on EUR was met with a LL on DXY, which is not symmetrical, That was USD SMT. And we have been looking for DXY to go higher. That means that we are expecting lower prices on EUR so all the premium arrays, will be used for going short. And we can filter out the better ones when there is a real distribution in EUR when we DXY not confirming. In a perfect world DXY should have made HL, when LH was formed on EUR. Then EUR dropped down and attacked the Sell side below the lows formed at 6am EST and then the SD -3 gives you the low of the day during London Close. So we have time and price. When they meet together this gives you the complete picture. Then you can walkaway confident that you got the biggest part of the daily range.
NWOG act as magnet for price
ICT was talking about how these imbalances on the fair value Gap Theory can be applied to the NWOG, that's created from Friday's closing price in Sunday’s new opening price and the midpoint of that which is consequent encroachment. How they act as magnets for fair value and the algorithm will sweep up to and down to old new week opening gaps and you're placing a minimum of the week you're trading right now and the last previous 4. So there are always 5 NWOGs on your chart.
ICT spoke on the topic of how price goes back and constantly referring to them as a dynamic fair value. The concept still is fair value, it's going back to these levels because it is utilized to inspire large fund sentiment, not retail. It's to inspire fair value for large institutional investors that bring money into the marketplace because it comes back to these levels knowing that typically they use the analysis of the previous week and if the market has moved away from those levels the algorithm prices in and it's coded to allow price back to those levels to offer opportunity for large flows to enter the marketplace. Not that large flows pushed price to these levels it's going to go through those levels regardless how much buying and selling is going on but when it happens it's designing the very stage for participants to come into the marketplace have real orders right then and there and then the counterparty dance between smart money and the less informed trader begins.
ICT was talking to how that morning on the live stream that he was sharing his coaching session with his son Cameron, he outlined the narrative what he really want to see. And its there 2 views of the whole story. What we DO want to see and what we DONT want to see in price to support or dismiss or narrative.
Sometimes there will be times when there is nothing to do in the market place and we simply wait for more intel and exercise our patience in doing so.
In this example ICT was teaching us that we expect price to run for the 1h SIBI, but if does go lower to the 15m BISI, then it might not reach for the SIBI.
ICT mentioned a sell-side liquidity pool that formed during the low period between 5:30am and 6am. He is interested in seeing if the market will push it slightly below that level to trigger stop-loss orders before reversing and taking it back up within the range. He plans to wait until 9:30am before entering that fair value gap. This was discussed during his live stream. At 9 30 is the fake move that's the Judas swing.
if 9 30 hasn't seen that FVG traded to yet and we have a move going down after 9 30, this is what we were outlining and talking about. That's a Judas swing because we want to see it run into that 60 Minute FVG that we got. So if that's our trade and that's what ICT was outlining and also what things can happen that could be against the idea.
On the 15-minute timeframe, the drop-down is moving into a 15-minute fair value gap and a bullish order block. If you look at your 15-minute timeframe, you can see how it drops down right into that fair value gap and stops to the tick, inside of a bullish breaker on the one-minute chart. Therefore, you have a bullish order block on the 15-minute timeframe and a bullish breaker on the one-minute chart. All of this is happening with the narrative that ICT outlined during the 8:20-8:30 GDP number release.
