a) HTF CRT = 5 PM and 9 PM
b) LTF Purge = 3 AM to 4 AM.
Draw on liquidity and Bias:
For this trade model, you will determine your bias and draw on liquidity by waiting for the 5 PM or 9 PM H4 CRT to be purged at 3:00 - 4:00 AM. Once purged, your bias will be in the counter direction of the purge. Similarly, your draw on liquidity will be the opposing 50% of the range and the opposing end of the range.
For example, if the high of a 5 PM CRT is purged at 3 AM, then your bias becomes bearish and your draw on liquidity becomes the opposing end of the range.
Important rules:
- The purge has to happen during 03:00 - 04:00 AM. (If the purge happens outside this time window then you don't take any trade and wait for another day)
- You must wait for a LTF CSD to occur on the LTF before confirming your bias and draw on liquidity. (If there is no CSD on the LTF then you won't be taking any trade.)
- CSD confirms your bias and if there is no CSD then no trade.
- Let me say it again, the purge has to happen at (03:00 - 04:00) otherwise no trade.
- Note and journal all of these rules.
This is how you determine your draw on liquidity and bias.
WARNING - MUST READ THIS:
This is the simplest way to determine your bias and draw on liquidity.
Let me tell you that you should only use these mechanical rules if you're a beginner. If you're an advanced or intermediate student, you must also integrate other concepts and profiles with it.
This method is just for beginners to build some basics around determining bias and draw on liquidity.
You could use the daily bias concept to determine your bias and draw on liquidity.
LTF Entry:
For your LTF entry, you must first follow all of the HTF rules. Once those rules are being followed, you then move to the LTF to look for your entry, adhering to the following guidelines:
- Purge Timing: The purge must happen at the 3 AM candle.
Entry:
- After the purge, wait for a CSD to occur.
Take the entry at the order block formed.
Stop Loss:
- Place the stop loss above/below the swing formed respectively. For instance, if a high has been taken and a CSD occurs, your stop loss will be placed above the swing high formed after the CSD.
Target:
- Aim for 50% of the range and the opposing end of the range.
Here are some examples to reverse engineer.
Look and see whether this trade follows all the rules or not and then decide whether you would've taken this trade or not.
You can see in this example the purge happened outside our preferred time window, that's why this wasn't a correct trade and you wouldn't have taken it.
Important Points:
Building Your Entry Model: Your entry model and system must incorporate all these aspects. This is one of the models I use to find trades, but as mentioned before, I also integrate other profiles and concepts to accurately determine my bias and draw on liquidity.
HTF Approach for Beginners: The HTF approach is highly recommended for beginners to build their basics and fundamentals in determining their bias and draw on liquidity.
Intermediate and Advanced Students: If you're an intermediate or advanced student, you can still use the HTF approach, but ensure you add other profiles and concepts to increase your accuracy and precision even more.
Fundamental Rules: You can make adjustments, but you cannot change the fundamental rules, such as the purge must happen at the 3 AM candle.
Backtesting and Journaling: Backtest this as much as you can and journal each of your entries and trades.
Educational Purposes: None of this is financial advice; it is all for educational purposes.
Winrate and Profitability: This strategy offers at least a 50-60% win rate with an average 3RR, which is enough to make you heavily profitable.
Long-term Profitability: Like any other strategy or model, it will have its losses, but in the long run, it will offer you money and profits.
Enjoy using this model!
If you prefer learning through video-form then I've made a detailed video about it too.
Give me 5 minutes.
This thread will completely change how you think about trading.
This is, without question, the best content I’ve put out so far.
- Sham.🧵
In the early stages of your trading journey when you're building your edge, your objective and main priority is to refine accuracy and minimize avoidable losses.
That means journaling every single trade, especially the losing ones, and identifying specific market conditions, market contexts, or scenarios that consistently lead to those losses.
You do this not to dwell on it, but to extract the truth behind it and find out whether it was avoidable? whether it lacked certain trade filters like SMT? whether it occured outside key time? and so on....
And over time, through this data, pattern emerges in your losing trades regarding that market conditions, the market contexts and the market filters within which those losing trades were taken... and that data shows you the "why" behind those losing trades.
1/9.
And then you respond to that with structure by creating specific rules and protcols like....
- Trade only in the direction of higher timeframe directional bias.
- Trade only during macros and killzones.
- Trade only when SMT is formed.
- Trade only after conformation.
- Or something like no trades on NFP day and so on.......
These filters and protocols reduces error, sharpen yours process, and give you focus.
And.....
This way your edge evolves.
This way your edge matures.
This way your accuracy increases.
This way you avoid unnecessary losses.
1- Price formed a CRT at a key-level. 2- We had a key-level in the form of a breaker.
Lemme explain it further....
Price usually tends to return back to the OB residing at the origin of an expansion before continuing its expansion.
But.
In certain cases price form a CRT in the form of a big bulky candle, before the OB is hit, around a key-level which prevents it from returning to the OB.
- Inside bar candles inside Candle ranges represent "accumulation of interest" around the candle's range.
- The more inside bars the better and explosive the "expansion".
PDA around it:
- PDA around candle ranges serves as a crucial confluence, especially as the most significant range purges often coincide with higher timeframe PDA.
- Additionally, timeframe alignment for coupling PDA can further enhance the quality of the Candle's range.