Notes
- Important levels to watch:
- Yearly highs and lows.
- Quarterly highs and lows.
- Monthly highs and lows.
- Weekly highs and lows.
- Intra-week highs and lows (highs and lows of previous days).
- Daily highs and lows.
- We should look for trading opportunities around supports and resistances from higher time frames, specifically on the daily and 4-hour charts.
- Michael does not use any time frame lower than the 5-minute time frame for forex trading.
- When Michael trades forex, he does not use any time frame lower than the 5-minute.
- Interest rates affect various asset classes, including stocks, commodities, and currencies.
- When bond prices fall, yields rise, and vice versa.
- When bond yields rise, currencies typically chase higher yields, influencing the forex market.
- Michael uses barchart.com to view bond market charts.
- Markets tend to move from periods of consolidation to trends, and understanding this cycle helps traders determine the optimal entry and exit points.
- Trade entries and exits should be made at the most volatile times of the day when the most trading activity takes place, i.e., during the so-called Kill Zones.
- Consolidation periods precede explosive moves.
- The consolidation phase is used to accumulate positions.
- Market makers often cause false breakouts to trap traders unaware of the deeper market structures.
- Institutional levels:
- Big-figure levels - 00 levels, such as 1800, 1.200, 96.00.
- Mid-figure levels - 50 levels, such as 1850, 1.250, 96.50.
- 80-20 levels - For example, 1820, 1880, 1.220, 1280, 96.20, 96.80.
- Small-rounded levels - Levels like 1810, 1830, 1,2230, 96.70, 96.90.
- Optimal Trade Entry Levels:
- 79% retracement (0,79).
- 70,5% retracement (0,705).
- 62% retracement (0,62).
- Power Of Three concept:
- If we are bullish, we focus on buying at or below the opening price (weekly, daily, hourly, etc.).
- If we are bearish, we focus on selling at or above the opening price (weekly, daily, etc.).
- Market Maker Models:
- Market Maker Buy Model.
- Market Maker Sell Model.
Short Trade Opportunity At Optimal Trade Entry Levels
Comparing Yields
Trading Activity According To Time
Time Frame Selection
Orders Around Key Levels
OTE Short Trade Opportunity Around Big Round Level
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