Month 1 · Lesson 1
Elements Of A Trade Setup
The two primary concerns behind every setup: the framework price is operating in, and the reference points institutional order flow leaves behind.
One lesson, one session
Make room to focus.
01 Focus02 Check yourself03 Reward
Choose a little time for this lesson. Pause whenever you need to.
XP comes from the lesson checkpoint. The timer is just for you.
Primary Concern A — Context / Framework
What makes an idea favorable for a trade? Not an indicator, not a support & resistance level — there has to be something that builds a reason to want the trade. Price is always in one of these four conditions:
Click a card to flip it
The interbank algoPrice for currencies is ~90% delivered by electronic algorithms — the interbank price delivery algorithm. There is no auction market anymore; it's a price engine, and it's highly manipulated — especially foreign exchange. Because of that, the fingerprints are easy to see once you understand the operations and conditions it functions in. And there's no such thing as the market "doing nothing" in a consolidation — it's accumulating orders.
RuleAll moves start from a consolidation. The market maker keeps price in a defined range until there's enough money on both the upper and lower end — whichever side has the most money to be absorbed, that's the direction it moves. We don't always know which it is, so we always wait for the first expansion — that gives us all the insight we need. Sometimes it expands too far to do anything with: then wait for the retracement or the next consolidation. That's normal — you're not going to catch every move.
Primary Concern B — Pairing Each Condition With An ICT Tool
Each condition couples directly with a specific reference point in institutional order flow:
Expansion
Orderblock — when price leaves a level quickly, don't chase; wait for price to come back to the orderblock the market makers left at or near equilibrium (the down candle right before the up move)
Retracement
Fair value gaps & liquidity voids — quick runs up/down leave gaps that price wants to come back into and close in
Reversal
Liquidity pools — just above an old high and just below an old low; price runs just past those levels, rejects, and goes the other way (turtle soups & false breaks)
Consolidation
Equilibrium — the halfway point of the range, defined by the bodies of the candles, not the wicks; wait for the impulse swing away from it
One setup is enoughOne of these conditions will become your bread and butter. Some traders will trust the equilibrium, some the orderblock, some the void. You don't need all of them — find one element, couple it with an ICT tool, and wait for those conditions. You won't get a trade every day, but you can get a couple every week. (Watch four major pairs with one condition and you'd find a trade every day — but that comes later.) Go through your charts and outline the examples that already happened on the left side.