A+ setup’s
Establish Weekly and Daily Bias
Understanding the bias is the foundation of every trade. It helps you decide whether the
market is bullish (buy-focused) or bearish (sell-focused).
Weekly Bias:
Analyze monthly and weekly charts to identify:
Liquidity pools: Zones where orders are clustered (e.g., swing highs/lows).
Imbalances: Price gaps where trades were not filled (Fair Value Gaps or FVGs).
Example: If last week ended with a strong upward trend, the weekly bias may favor
further upside.
Daily Bias:
Use daily charts to refine your view:
Where is the largest pool of liquidity?
Does the daily trend align with the weekly bias?
Example: If the weekly bias is bullish and daily liquidity lies above, focus on buy setups.
2. Build a Market Narrative
The narrative helps you anticipate the market's flow based on recurring price behaviors.
Key Narrative Elements:
1. SMT Divergence:
Compare related assets (e.g., EUR/USD and GBP/USD). A divergence in their highs or
lows signals a potential inefficiency.
2. MMXM (Market Maker Execution Model):
Determine if the market is on the buyside (targeting buy stops) or sellside (targeting sell
stops).
3. AMD/PO3 Framework:
Break the day into 3 main trading sessions:
Asia: Consolidation or sideways movement.
London: Expansion and manipulation (often sets the high or low of the day).
New York: Continuation or reversal based on Asia and London.
4. Trend Day vs Search & Destroy Day:
Trend Day: The market moves steadily in one direction.
Search & Destroy: The market hunts liquidity on both sides (highs and lows), creating
a choppy day.
3. Focus on Liquidity and Points of Interest (POI)
The market is driven by liquidity – areas where orders are concentrated.
Liquidity Zones:
Look for key levels where price is likely to gravitate:
Previous Highs/Lows: Previous Day/Week/Month Highs or Lows (PDH, PWH, PMH).
Session Highs/Lows: Asia, London, and New York session highs/lows.
Recent Highs/Lows: Levels on smaller timeframes (H1, M15, M5).
Points of Interest (POI):
Identify areas where price may react, such as:
Fair Value Gaps (FVGs): Gaps caused by imbalances in buying/selling.
Order Blocks (OBs): Areas of significant buy/sell orders (often tied to institutional
activity).
POIs exist across multiple timeframes (Daily, Weekly, H4, H1, M15, M5).
4. Understand Market Structure and Shifts
Market structure helps you determine the current trend and recognize when it changes.
Market Structure Basics:
Identify higher highs (HH) and higher lows (HL) in an uptrend or lower highs (LH) and
lower lows (LL) in a downtrend.
Track this structure across timeframes:
H1: Higher timeframe view.
M15/M5: For refined entries and shifts.
Market Structure Shift (MSS):
A MSS occurs when price breaks a key high/low, signaling a possible trend change.
Distinguish between a genuine MSS and inducement (fake breaks designed to trap
traders).
5. Execute Setup Entries
Use specific rules to enter trades with precision.
Types of Entry Setups:
FVG within Breaker: Look for FVGs that overlap with Breaker Blocks (zones of failed
moves that reverse).
OB within FVG: Combining Order Blocks with Fair Value Gaps for stronger setups.
Pure setups include:
FVGs (Fair Value Gaps).
OBs (Order Blocks).
Breakers (failed moves that become support/resistance).
BPR (Balanced Price Range): Price consolidates within a fair range before breaking
out.
6. Manage Risk: Stop Placement and Risk-Reward
Risk management ensures long-term profitability, regardless of win rate.
Risk-Reward Ratio:
Always aim for a 2:1 reward-to-risk ratio or higher.
Example: Risk $100 to target $200+.
Stop Placement:
Logical stop-loss levels include:
Below/Above High of Day (HOD)/Low of Day (LOD).
At Intermediate or Short-Term Highs/Lows after a stop hunt.
Below/Above critical candles in FVG or OB setups (e.g., Candle #1 or #2 of an FVG).
Practical Example:
Let’s say the weekly bias is bullish, and the daily chart shows liquidity above the current price.
1. Narrative:
Asia consolidates, London expands upward, and New York likely continues higher.
Liquidity lies at the Previous Day High (PDH).
2. POI:
Look for an FVG or OB on H1/M15 near support.
3. Entry:
Enter long at an M15 FVG during New York after confirming bullish structure on M5.
4. Stop:
Place the stop-loss below the London session low (logical liquidity level).
5. Take Profit:
Aim for at least 2R, targeting the PDH.
In Summary:
This approach combines liquidity-driven trading with logical entry setups while managing
risk effectively. By analyzing the market's behavior across multiple timeframes, you can
confidently predict price movement and align your trades with the market's intent.