As smart money concepts gain popularity, liquidity increases.
I have taken a month away from trading to study the new forms of market manipulation and have been pleasantly surprised by what I have found.
Here is my discovery:
1) The market is currently focusing on taking liquidity from breakeven positions over fixed stop losses.
This is because emotional traders put their stops to BE quickly to avoid pain, especially during indecisive markets.
2) Order blocks are the perfect manipulation areas.
If you take time out to backtest significant order blocks, you will notice price will tap and lure or simply sweep above/below the zone before going in the intended direction.
3) That tight stop loss you are using is doing more damage than good.
Scale into your positions, trust me when I say this will reduce your emotions and give you a more relaxed trading style.
4) Use your brain, even if you are in denial.
If the majority of traders lose money, and the majority of traders now use smart money concepts, do the maths.
It feels good to be back after a long month of studying, I have lots of new things to teach and share.
I will be taking on new students shortly, have a great weekend everyone 👋
Nice post! Could you also have used the other bearish order block on the 22 Aug at 2:00? As I'm aware, a bearish order block is defined by a displacement lower that creates a FVG in the process. It looks like from your chart is was a good draw on liquidity. Also, where would you SL be placed in this scenario?
AlkalineFX
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@Tukke, I appreciate you Tukke, very interesting, let me mark out the OB and get back to you.
Usually, the SL is safely above the OB to account for any sweeps above it.
parissap
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great educational post thank you and agree with you, ATR helps me not trap and gives me a proper SL most of the times