Notes
- Classification of swings according to advanced market structure:
- Long-Term High (LTH) - LTH typically has lower ITH on the left and lower ITH on the right.
- Long-Term Low (LTL) - LTL typically has higher ITL on the left and higher ITL on the right.
- Intermediate-Term High (ITH) - ITH typically has lower STH on the left and lower STH on the right.
- Intermediate-Term Low (ITL) - ITL typically has higher STL on the left and higher STL on the right.
- Short-Term High (STH) - Any other swing high that is not LTH or ITH.
- Short-Term Low (STL) - Any other swing low that is not LTL or ITL.
- Every time the price rebalances the FVG, the resulting swing becomes an ITH or ITL. Once it is formed it should not be violated.
- LTH and LTL are generally linked to a daily chart.
- Michael considers John Murphy’s Technical Analysis of the Financial Markets to be the retail trader’s bible.
- We do not perform technical analysis. We do technical science.
- Long-Term Secrets to Short-Term Trading is a book by Larry Williams that had a big influence on Michael’s development early in his career.
- The Advanced Market Structure (Advanced Price Action Theory) concept works in all markets.
- It is not realistic to use an Advanced Market Structure (AMS) on all time frames. Therefore, Michael applies it only to the one-hour chart, representing the higher time frame. However, he also uses the logic of creating ITLs and ITHs (based on FVG rebalancing) on lower time frames.
- If we use three time frames for our analysis (for example, daily, hourly, and 5-minute charts), the intermediate-term time frame seems to be the most suitable for the AMS application.
- According to Michael, the algorithm only does two things:
- Removes liquidity above old highs and lows
- Rebalances old imbalances and creates new ones
- When the institutional order flow is bearish, all up candles will be respected (not broken).
- When the institutional order flow is bullish, all down candles will be respected (not broken).
ICT 2022 YouTube Model - NQ Daily Chart Example
ICT 2022 YouTube Model - Advanced Market Structure (Advanced Price Action Theory)
ICT 2022 YouTube Model - Intermediate-Term High And Short-Term High
ICT 2022 YouTube Model - Bearish Order Block
ICT 2022 YouTube Model - ITH Should Not Be Violated
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