08 Feb, 2019_rev.txt

Good evening folks, this is the economic calendar for next week. This recording is actually going to be our normal Monday video, but my wife just informed me that we have plans that I was unaware of. So it's life. So we're going to do the analysis now, and if there's anything that needs to be mentio...

Good evening folks, this is the economic calendar for next week. This recording is actually going to be our normal Monday video, but my wife just informed me that we have plans that I was unaware of. So it's life. So we're going to do the analysis now, and if there's anything that needs to be mentioned or attention drawn to on Monday, I'll draw it to your attention by way of Twitter. So the economic calendar for this coming week we have on Monday, a lot of high impact news for GDP in the London session. GDP, manufacturing, production, and then on Tuesday we have Carney speaking at 8 a.m. for GDP, and we have a medium impact speaker in London for Tuesday's Eurodollar session, and on Tuesday, late afternoon, my local time, 12.45 p.m. we have Fed Chair Powell speaking. And then on Wednesday we have high impact CPI for GDP in London, PPI as well, at 8.30 a.m. news embargo lifts at New York Open, CPI, and of course CPI, high impact for the dollar. On Thursday we have another medium impact speaker for GDP during the London Open. Euro will see preliminary GDP numbers in the form of a medium impact news driver at 2 a.m. And 5 a.m. the flash GDP for Euro. At 8.30 a.m. again news embargo for New York session lifts for core retail sales, PPI retail sales numbers for the dollar index. All majors will be affected by that on Thursday. Then on Friday we have medium impact and high impact news drivers, one for the London session related to GDP for retail sales. And then we have 10 a.m. consumer sentiment for the dollar closing out the week. Overall, I think that we should see a pretty eventful Monday. I think we'll have some volatility, which is typically uncharacteristic. I think we'll see some GDP movement on that day. And then we have. Wednesday, CPI numbers may be impactful for GDP. The highlight for. Your dollar, I think, will be the Thursday session. I think Thursday will see a nice form of volatility that day because of the GDP numbers and. The flash. Release at 5 a.m. Apart from that, I think we'll start to see a little bit better economic calendar. This is certainly something that's more favorable. Something more that I'm used to operating in. So let's go over to the charts and start breaking it down. OK, so we're looking at the dollar index. This is the daily chart. And I mentioned in commentary for this week. That I wanted to see it trade through this high. And we did see that we've had an attempt to trade down into it again, which is what I want to see as well. And we closed above the open on Friday, all the price action. Leading up to this high in here, this really shouldn't have a lot of resistance. It should just study, move higher. And make it run into the by side of the quality pool. And again, that weekly inefficiency now mentioned several times. So we're looking at this sell side imbalance, buy side inefficiency liquidity pool. OK, so we're going to be expecting much like I've been expecting for a couple of months now to see this thing filled. But we're looking at a weekly chart. It takes a long, long time. And that's why I don't have the patience to trade that time frame as you use it for a bias, if you will. So I'm going to take that off here for a second so we can see clearly. Above these highs. This right here. OK, and what I'm looking for is basically the same thing that was outlined on the dollar cap. We had a equal high. Sell side imbalance, buy side inefficiency. This is what we're expecting to see. OK, which I can see that run through. Just being applied to the weekly chart on the dollar. OK, so it takes a long time for that to be panning out. So we drop back down into a daily. Really nice movement here. I like the idea of staying above this candle's body. So we can take this level here, which was a lower level breaker that we had outlined. Looking to see that trade through. So we want to see price stay above that. OK, and that price specifically is 96.35. So as long as we're above that, we're bullish. I mentioned that I would see it as a run above the old high and then rejecting and going lower. I didn't think that was going to happen. I still don't think that's going to happen. I think that they're going to send this thing higher to clear up this area here. So 98 are are likely for the dollar. Maybe going over to Euro dollar. OK, this pair has been stuck in this range here, but I think we're about to move into that inefficiency that we've talked about for a while now. So in this case, we have a buy side imbalance sell side inefficiency liquidity pool. I expect to see a run to it. So about 110, 20. So it's calibrate our level. So 110, 20. Bam. There you go. So that level will remain on our charts. So we're expecting to see essentially a 310 pip slide in the market. 10 pip slide on your dollar. Keeping that on a chart, dropping back down into a daily. All of this price action here. It's demystified, if you will. We have that weekly level on a chart. It provides a lot more context. All of these lows in here, this is uncharacteristic of price action. It doesn't like to keep these things intact. So we'll be looking to press through that next week. We may come back up into something like this. We use horizontal lines because I don't have the patience to be dealing with those line segments. We may trade through that and come back up, trade into that area here. Let's just see some mitigation and trade lower. I would rather actually not even come back to this. I'd like to see it just make a straight decline all the way into that 110. Now, that's not to say that we're not going to see up close candles. I'm just saying that I'd prefer it to not come back and hit that. That way, what it would do is on a longer term basis would keep the range between this low and this implied objective for downside of target 110.20 relative to the weekly chart. It would create a sell side imbalance, buy side inefficiency. So if it trades down here without coming back up to this, that means when we trade back up to it here, that's a better area to sell short on a longer term swing trade, position trade idea. And then watch it start to erode a little bit more. Again, as a long term macro perspective, I still see Eurodollars. I've said this years and years ago on my YouTube channel, but it just takes a long time for these things to to develop. Much like my call on 102, 104 on the dollar index. It took several years to get up there. So I believe that Eurodollars and dollar will go to parity eventually. What time frame? I don't know that because it's such a long term thing. I don't know that. But I think that if we see a run below this low, it should be delivered in a steady decline. And then once it hits this area down here, rebalance that weekly buy side imbalance sell side inefficiency, it'll create an opportunity for it to run back up, which is all completely tradeable. Being long, but waiting for a later time frame that goes short here and then hold that for a little bit longer price move. Again, using higher time frame weekly analysis, but it's the same thing you see me do on the intraday charts just applied to a longer term boring time frame weekly. So everything here indicates it's going lower and it's supportive of the higher dollar. We have a lot of liquidity resting below 113. So it could see a pretty impressive run down into the one twelves and then getting into one elevens high one elevens. I'll make my consolidate around in one elevens a little bit, create small little up closes and then again targeting one ten, one ten twenty. If we go below one ten twenty, you know what to see what happens then. But right now we have to take one thing at a time, one level at a time. So that's the skinny on the euro from a daily perspective, we drop down into an hourly chart. OK, and we put the dividers on. You can see last week I had this short up and when they close on Friday after non farm payroll. The market eroded all the way down. And we end up creating the low of the week on Friday. This right here is just complete utter weakness. There's simply no buying going on in euro dollar. No one wants to touch it, they want to hold it. So it's just in a heavy mode of distribution. So I think that what we just outlined from the weekly perspective is certainly being. Followed, if you will, from the banks, so everything we see here will probably be the continuation going lower again next week. I don't think we'll see this just slow little drift lower. I really don't like these types of movements. I like them sharp, punchy, creating imbalances. When it's like this, it forces you really to go down into lower timeframes to get your imbalances, which is not a problem if you're comfortable with doing intraday. But as an educator, it's easier for me to show you when we work with like this. OK, we have these imbalances like that because it's easy for me to pull your eye to it and you can see it. When it looks like this on the daily, it provides a lot of confusion because we have to incorporate lower timeframes. And right away, if you're completely against the idea of day trading or scalping or even short term trading, it just the students tend to plug their ears and they're watching TV or reading something. They're not really paying attention to what I'm teaching at the time. So it just makes it more difficult for me to try to hold your attention. So if we drop down to a 15 minute time frame, you'll see going into Sunday's trading, Monday's trading here, rather sloppy. We mentioned this potential drop down. We got that run during a quiet period of the time. Then you settle off again here on Tuesday. Tuesday had a run up in New York Open. Market protraction. Clearing out anyone that was short, upsetting that neutralizing liquidity on short positions. And the market has a nice drop lower. The following day, we have just no real attempt to try to rally at all. And we get into the London session, small little run on stops. Nice imbalance here. This is sell side imbalance, buy side inefficiency. So you can start seeing the effects of the out close candle, which is a bearish order block. Liquidity pool again, imbalance all sell side. So the market will want to go up into that to rebalance it. It does it perfectly. And then we have distribution, equal lows. This right here is your low resistance liquidity run set up. Very, very easy type scenario. And then on this day here, market protraction, judo swing, London. Back into consolidation, sells off. And then we have a nice little pop on the New York Open. Trading back up into a liquidity pool. Moving into a consolidation, dead period of the day. Runs down below the low, pops back up, clears some stops, equal highs, runs those intraday. Then heavy distribution to take out the low one more time here. And then we consolidate going into the close. So I think that we'll still see this trade lower. I believe that if we focus on shorting rallies above equal highs or shorting inside of sell side imbalance. OK, in other words, if we see a drop down, aggressive drops like this or like this, not like this, because you can see that big wick up here that was rebalanced. So it's not necessary for it to come back up into that. This one would have been a nice ideal scenario to see if it would have traded a little bit higher up. Clear these equal highs, close that in. That would be a classic ICT, London Open, sell short. I bet it just didn't have enough energy up there. But if we see periods where we have the one or two single down close candles, that's a sell side imbalance. It's too much selling, not enough buying in that same period or between that range of price. And the market will want to go back up into that. So if we train our eye to look for those in the Eurodog in the coming weeks, that's really what you should be focusing on, on practicing that as well. All timeframes, not just the 15 minute time frame. You can look for it on a 30 minute chart. You can look for it on a four hour chart, five minute chart, and even on a one minute chart. Just train your eye to look for them and then watch how it goes up and fills those. And then the reaction is after that, we expect to see it continue to go lower. Obviously, the best time is during the kill zones, London Open, New York Open, and not so much in Asia because Asia's accumulation in essence, over here like this and like this. So we want to see the energetic periods of the day, New York Open and specifically London Open. Moving on over to cable. This thing, if we even pull up a weekly chart, I'm just really, I have no idea. I want to believe that they're just going to do something that's completely unexpected and it will be like a black swan. And it's really, really, to me, it's something I want to be a part of to some degree because I think there's going to be a big movement in it and it's going to probably be against what every other currency is doing because if we can have a crazy run, the dollar doesn't have to be doing anything contrary to it because it's a Brexit type thing. The whole, I guess the impact of whether Brexit's an event that's going to take place or not, the longer it stays in discussion like this, the harder cable will be for a long-term clear forecast. So I just wish they would just get on with it, just get it over with because I love trading cable, I want to be in cable, but if we don't see a lot more definition in terms of the price action, I will have to ring in an extra currency pair and it may be the Australian dollar or the dollar CAD. I'm not taking up a vote for which one I want to put in or which one you all collectively want me to put in there. I'm telling you which one I'm going to put in there. It's either going to be dollar CAD or it's going to be Aussie dollar and if cable gets act together, then I'll just remove it again because I want to keep the focus on two pairs, but if I can't do what I want to do on cable, I want to at least give you additional insights in another pair that's outside of my pet pairs. I just wanted to toss that in there. When would I decide that? I don't know. I'm just telling you that's on the back burner. I'm thinking about it. I've been contemplating if we stay in this mess on cable, I may just ring in another currency pair. All right. So with cable, we came down here, cleaned up this run. Let me zoom in a little bit. This run from the swing low right in here traded into the order block there and this wick and this big drop down in here. To me, I don't have anything inside this entire range right here between this high and this low. I have nothing in here that allows me a real clear definitive. This is where I think it's going to go. We do have equal lows here. Yes, but then we have all this as well and it's inside of this as well. So I don't know and I want you to at least appreciate the fact that there's going to be times when you're not going to have an idea what to do. And there's two camps when it comes to things like that. Well, you should know better. I'm paying you. You should know better. OK. OK, that's acceptable and that's reasonable because there's going to be times when you have to be in park. I tweeted this and said that there's times even the fastest of sports cars and I own some, they all have park. OK, they all have a park in their transmissions. So they don't always go, go, go, go, go. So if I identify when I'm unsure about something, it's not meant for you to feel, well, this is unacceptable or this is you claim this, you should know better. You know, there's going to be times when you just can't get anything in terms of probabilities being high. I can't sit down and tell you with a great deal of accuracy or confidence because I'm not confident. That's why I'm staying away from it. Yeah, I see it intraday for scalps only. But from a higher time frame perspective, I just don't see anything in here. Like I don't feel confident pointing either direction. I want to believe it's going to be slammed higher and simply because it just feels like that's what's going to happen. And it's just a gut feeling. It just feels like something explosive is going to happen in this pair. But I for for the life of me, I just can't determine what would frame it. And since I can't do that, I got to treat it like a rattlesnake. OK, it's it's going to bite me. I already know it's going to if I try to engage with it. So I'm just leaving it alone. It may change. It may not change. It may stay like this for a couple of months. Like I said, I have a contingency plan. We'll bring another pair. But meanwhile, we do have something that's pretty loaded for your dollar. And if we have sympathy in cable, it may want to just drop lower in response to that. And then all of this right here, Brexit pump may be just completely eroded and they attack the equal. Well, not that they're that close, but they're close enough in terms of this. You know, this time frame. So they can make a run on that from a long term perspective. In other words, all this run was just to get above this high takeout, large fund stops and then trade lower. That could be what may happen. Maybe I'll participate in that movement and maybe I don't. I don't know right now. I have to be honest with you and just tell you this. There's nothing for me to to outline for you for cable. With that said, we can look at things on a hindsight basis and look at what took place. Over the week and we had a nice little run in here, taking stops on New York session and erosion took place. This here, this day, right in here is to me a beautiful piece of price action. Right in here. In fact, let's go in here and take a closer look at it. I want to talk a little bit about market structure. So inside this day here, we'll break it down in a moment. We have a low here. It had a lot of decline and then it came back up, rebalanced that. This is the classic area where we want to be engaging or trading up into, depending upon your model. If the market were to take out a high energy low, in other words, this is like a lot of aggression to get down to there and then it turned trade all the way back up. If we take that out, this is going to be a natural, but this is in your notes, it's a natural break in market structure. Now what does that mean natural break in? What does it have that distinguished from a classic shift in market structure? A classic shift in market structure would be something like this where we've traded up, up, up, up, up, up, up, and then the last high, the low in between there is going to be broken right there. So any little short term rally should be distributed. When we see high energy levels where the market quickly runs to it, there has to be speed, there has to be a lot of energy behind it. In the 90s we called them caffeine bars. It's because there's a lot of energy behind it. I didn't come up with a term, it's just something I, I like the idea of calling it that. It made sense when we were talking about it in the Merck chat rooms. So this is a big caffeinated candle or bar on the downside and then rice runs through. So there, it took a lot of energy to get down there and took very little time to get there. So if that low gets broken in the future, this is what's going to be a natural break in market structure. You would be commonly referring to it as a break in support. But I'm showing you why that level versus why draw a support level on any higher low because there's no real structure to it when you look at support resistance. The idea is, pick your poison. Okay, well this, this is a high energy movement and then price comes back and rebalances that. If we break that low, it's going to be a natural break in market structure. In other words, this is going to be a valid break of old support if you want to call it that. So I just gave you the rules of determining what support resistance levels should be broken. If they are broken, what that means and they should be influential in the future. So with that in mind, if we draw that on here like that, we have a high energy low. And if you're not writing this stuff down, you're going to be so disappointed later on because you're going to forget what video this is talking about it and you're not going to remember the rules either. Okay, because I don't know when I'm going to talk about it again unless the point or concept comes up, but I'm only being prompted because I got a question by way of a direct message. Can I talk more about a market structure? So I'm giving it. So we have a natural break in market structure here because of the high energy low. This would be a high energy high because it took a lot of energy in one candle. Get up there like that. So if we have points of like this high being formed, if price was ever to trade through that, that would be a break in market structure, a natural break of market structure to the upside. And if price ever came back down to it, it could act as support. Well, this being support here at a high energy low, if it breaks that, that becomes what? It's an inversion level now becomes support broken, now becomes resistance. That's what we have here. So we trade through it there, not on a closing basis there. Okay, notice the difference. We stabbed through it here, touched it here, stabbed through it here, traded and closed through it. Now it's a real break in market structure, a natural break in market structure. So we can see price come back. Notice we were below here. We trade through it a little bit. This is called a retest. This is a retest and market moves away from it. This is a retrade. Two distinctions there. Retest, it's hanging around, touching it, touching it, touching it, multiple little kisses. Then it leaves it, then comes back and retrades to it. So it trades back up to it. Why? This is where the mechanism of the algorithm, where heavy distribution cell program kicks in, only relative to time of day. So now we have a framework. We have a natural break in market structure. The market is clearly broken through and closed. The market is showing a willingness to go away. And now if it comes back to that during a kill zone, okay, on this candle here, what is that? That's London Open. This candle here. London Open. This candle here. London Open. All these candles wicking up into it and just slightly through it is a beautiful illustration of a classic sell day. And the market corrains lower, making a very nice distribution day. What day of the week? Tuesday. Okay. Same scenario with the element of natural market structure breaks. We have a lot of energy traded down here. What is it doing? I didn't mention it back here. Let me go back and say it. It had a lot of energy getting down to this level. Why? Because there's an old low. It runs that as stops. Okay. And if we ever break through that, it wasn't just a run on stops. Now it's a meaningful run lower. That's what makes it natural in terms of breaking the market structure. Okay. So, we have a low here. Okay. The price trades down through it with all these candles. Notice the size of the candles in relative term to all the previous candles. They're smaller. So, there's a lot of energy that makes a run below this equal lows. So, we have a run on stops. So, this low right in here becomes an area if it ever breaks and we see it trade down and close below it here. All this run back up, we're not concerned about it. We want to see when it trades below and closes and it does so here. Once we have that, same thing we discussed over here, it can come back, retest, retest, retest. It's the time of day that's important. Notice it's so close to, well, it's basically Asia, late New York going into Asia and then now we're in Asia and then boom. What time of day is this? Essentially, it's early stages of New York open. This is absolutely New York open here to open into the high New York open kill zone. Trades into it, natural break in market structure. Real support resistance broken. So, now you have learned tonight the amplified version of market structure, whereas you guys know simple classic breaks in market structure to help you with daily bias. This gives you tradable market structure shifts or breaks in the form of natural breaks of the market structure. Got to have a lot of energy, runs lows. Why does it go down there? It stops. So if it ever breaks below that again, it's a real break in support. Anticipate retests outside of the kill zone, but a retrade to it, that's exactly what you're looking for for a setup because you're going to see clear respect of natural support resistance through in form of market structure being broken, which is a natural market structure break. So, hopefully you found that insightful. I will give you all more information again on Monday by way of current market action. If there's something to talk about, I'll send a link or idea through Twitter to be watching. Have yourself a pleasant weekend. Just as a reminder, if you're waiting for continuation for your next month's content and you paid early, you're going to have to wait until February 24th. That's where early payment continuation access is granted. Remember, it's always five days prior to the new month's first day. Your payments are always due on the first of the month, but five days prior to that, if you pay earlier, the fifth day prior to the first of the new month, that's when I grant access to those that paid early that day. The 10th of February is this Sunday. I will not be doing any administrative work. So if you have not paid come Monday morning, you will be disrupted. Your access will be removed and you'll have to make your payment to get back in good standing. If you have not made your payment on Monday and your account gets disrupted, it doesn't mean you got kicked out. It just means that we're waiting for you to make your payment. But if it does go to March 1st and you have not made your payment, your account is terminated and that is a cancellation in terms of use apply. So with that, I will catch up with you on Monday. Until then, wish you good luck and good trading.