ICT 2024 Mentorship – Lecture 4 Notes
Hey Folks! Welcome to the fourth lecture notes of the ICT 2024 Mentorship series. In
this lecture, Michael provides a detailed analysis of key market drivers and their
implications for trading strategies.
He emphasizes the importance of market driver news released at 08:30, which can
significantly influence market movements.
Michael also explores the strategic relevance of the new day and new week opening
gaps, highlighting how these gaps can signal market inefficiency and liquidity.
Additionally, he discusses the impact of the 09:30 market open, illustrating how this
critical moment can create trading opportunities.
This lecture offers essential insights for traders looking to refine their strategies and
better navigate the complexities of the market.
Key Elements
(I) New Day Opening Gap : is abbreviated as NDOG and it’s the gap between closing
price at 05:00 PM (New-York local time) and the opening price at 06:00 PM (New-York
local time).
(II) New Week Opening Gap : is abbreviated as NWOG and it’s the gap between
closing price on friday at 05:00 PM (New-York local time) and the opening price on
Monday at 06:00 PM (New-York local time).
(III) Market Structure Shift : is the initial change in the delivery of price which indicates
a short term change in trend.
(IV) Fair Value Gap : is a three candle formation having gap between 1st and 3rd
candle’s wick.
(V) Inverse Fair Value Gap : is a failed fair value gap which works inversely.
(VI) Breaker Block : Breaker Block is a failed order block.
(VII) Liquidity Sweep : is the phenomenon of hunting liquidity above highs and below
lows.
(VIII) Relative Equal Highs : is when a high has a lower swing high on right side of it
formed due to price swing failure.
(IX) Relative Equal Lows : is when a swing low has a higher swing low on right side of it
formed due to price swing failure.
(X) Consequent Encroachment : is the 50% retracement level of PD-array.
(XI) Quarters of a GAP : You can use following fibonacci settings to find the quarter
levels of a New day opening gap or a New week opening gap, 0, 0.25, 0.50, 0.75 and 1.
(XII) Premium and Discount : premium zone is above the 50% retracement level
between an established high and low while discount zone is below 50% retracement.
Key Timeframes
(I) 15 Minutes
(II) 05 Minutes
(III) 01 Minute
(IV) 15 Seconds
Key Times of the Day
(I) 08:30 AM (New-York local time)
(II) 09:30 AM (New-York local time)
Application in The Market
As the lecture 4 of ICT 2024 mentorship is based on the economic news at 08:30 AM, ICT
suggests not to focus on the numbers or news because the charts tell the real story.
And you will use the New day opening gap and the New week opening gap as
inefficiencies and the draw on liquidity.
News will draw the price to the cluster of these inefficiencies and then the real move
comes after 09:30 AM, because of the actual market opening.
(I) Bearish Bias
If your Daily Bias is bearish on the news day, you will look for the the New day opening
gaps and new week opening gaps above the price in Premium zone, if there is no gap
you can look for Fair value gap or inversion fair value gap.
Mostly before the news at 08:30 AM price looks sandwiched between two levels that
could be a gap.
At 08:30 AM after the news release you will wait for price to draw to the cluster of new
week/day opening gaps above the price or even into a fair value gap.
While going to the premium price will grab the short term highs as buy-side liquidity.
If price continues spooling after the news release you should wait for 09:30 AM (equity
market open) to get an A-plus trade setup.
When price reaches the premium, drawing to the pool of inefficiency, you will look for
an ICT Market Structure Shift on 01-Minute time frame and you will execute a sell trade
at the breaker block or fair value gap when price retraces above the 50% level.
In this case your stop loss will be above the high formed before the market structure
shift and for take profit you will aim the NDOG or NWOG as draw on liquidity
alternatively you can look for old lows like previous session low or previous day low and
relative equal lows.
(II) Bullish Bias
If your Daily Bias is bullish on the news day, you will find the New day opening gaps and
new week opening gaps below the price in Premium zone, if there is no gap you can
look for Fair value gap or inversion fair value gap.
Mostly before the news at 08:30 AM price looks sandwiched between two levels that
could be a gap.
At 08:30 AM after the news release you will wait for price to draw to the cluster of new
week/day opening gaps below the price or even into a fair value gap.
While going to the discount zone price will grab the short term lows as sell-side
liquidity.
If price continues spooling after the news release you should wait for 09:30 AM (equity
market open) to get an A-plus trade setup.
When price reaches the discount zone, drawing to the pool of inefficiency, you will look
for an ICT Market Structure Shift on 01-Minute time frame and you will execute a buy
trade at the breaker block or fair value gap when price retraces below the 50% level.
In this case your stop loss will be below the low formed before the market structure shift
and for take profit you will aim the NDOG or NWOG as draw on liquidity alternatively
you can look for old highs like previous session high or previous day high and relative
equal highs.
NOTE : If price just test the 1st quarter (0.25 level) of gap and runs away this indicates
that price is not gonna test the consequent encroachment level of a gap neither it
wishes to fill the gap.
