SMT Divergence For beginners. This is a foundational thread which explains all you need to know.
- I'll DM you the PDF, read until the end.
A Thread🧵
What is SMT?
SMT shows up when two assets that usually move together start acting differently.
Look for a “failure swing” — when one tries to move but can’t.
Markets turn in two ways: liquidity grabbing (breaker) or failing to grab them (failure).
Where to Look and Confirm SMT?
When you mix ERL/IRL with SMT, you get a strong way to spot reversals at key levels.
SMT is confirmed with a CISD. It's not valid until a valid CISD/OFF forms at the key level.
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[🧵 Thread]
What is an Daily Bias?
Daily bias is the expected direction (bullish or bearish) of the market for the day based on key levels and market structure.
Bullish Bias:
To find the daily bias, start by marking the high and low of the previous day's candle. These levels help you see where price might go next - whether it's likely to move up, down, or stay.
Rejection Blocks :
- Every time a new high or low is formed we anticipate some sort of rejection, that is the first anticipatory price skill set you should be working on because it is the hardest.
Bearish Rejection Block :
Bearish Rejection Block is when a High has formed with long wicks on the high(s) of the candlestick(s) and price reaches up above the body of the candle(s) to run Buy Side Liquidity out before price declines.