Day Traders Must Use This In Their Trading

If you are a day trader and you are not incorporating this one simple concept into your trading, then you are leaving so much money on the table. How is it possible that day in and day out we are calling moves like this? Is it random? Are we just getting lucky? No. There is one confluence that I use when I am day trading on a lower time frame that allows me to catch tops and bottoms like this. This is using fair value gaps. This is the missing factor. This is what I use as a higher time frame delivery, and I always use higher time frame fair value gaps as my directional condition when I am day trading. You see, a lot of you guys have the entry model down. You know how to spot an inverse fair value gap. You know how to spot a market structure break, but there is no context, right? There is no higher time frame context. What you want to look for is high time frame alignment plus lower time frame alignment. Okay, I've talked about this on this channel a few times before. This is the missing key. This is the edge that all of you guys are looking for in your trading. It is not another entry model. It is not another secret trading strategy out there that's magically gonna make you profitable. All you're missing is high time frame alignment. I can almost guarantee, once you start implementing this in your trading, your win rate's gonna go up, and you guys will be passing evals left and right to getting real payouts to your bank account. Okay, cool, so what does this actually mean, and what time frame fair value gaps do we use? All right, and really quick, guys, before we jump into this video, I have coded everything that I'm sharing with you guys today into its own indicator called the Manipulation X Indicator. I also go live Monday through Friday inside the Discord trading this exact same strategy. I'll leave this down in the description below. Let's jump into the good stuff. So here we are right at the 9.30 market open. Okay, if you guys didn't know, I trade New York open. So I trade from around 9.30 to 11 a.m. Eastern every single day. I would highly recommend, okay, trading one strategy on one session. Do not try to trade Asian session, New York session, London session. Start trading one session only. So the first thing I'm doing when I head into the market is I am going to a one and four-hour time frame. All I'm doing is marking out fair value gaps that I see on my chart. So I can see we have a four-hour bearish fair value gap that we are currently testing, and I'm looking for a bullish fair value gap below. We do have this bullish four-hour fair value gap all the way down here, but it's nowhere near current price, so I'm not really worried about this. So I see that we're rejecting off of a four-hour fair value gap, okay? Now let's go down to a one-hour time frame and mark out our one-hour fair value gaps. So I can see here that we have formed this one-hour bullish fair value gap. So we have a one-hour bullish fair value gap right here, and we have a four-hour bearish fair value gap above. Now, these are levels that I am interested in taking potential positions off of, okay? So taking shorts from this four-hour bearish fair value gap lower, or taking longs from this one-hour bullish fair value gap higher, right? Because how does price move, okay? Price trades from IRL, or internal liquidity, to ERL, or external liquidity, right? So by marking out these fair value gaps, we are marking out levels on our chart where there is internal liquidity, or just open and resting orders, right? Liquidity is what actually moves price. And we are trading from these fair value gaps to these levels on our chart, or trading from this bullish fair value gap to this external high on my chart. So that is all I'm doing, okay? I'm also, at this point in time, marking out my 15-minute bullish and bearish fair value gaps as well, okay? So I see we have a 15-minute bullish fair value gap all the way down here, and we also have a very small 15-minute right here. This is the most important part, guys. I am not taking a trade unless price is delivering or reacting from one of these fair value gaps, meaning I am not going to take a long position as price is inside of a four-hour bearish fair value gap, and I am not going to take a short position if price is inside of a one-hour bullish fair value gap. I'm only going to take a trade when I have high time frame plus low time frame alignment. I'm only looking for longs once price is inside of a higher time frame fair value gap. That's our high time frame alignment. And then I'll drop down to a one to three-minute time frame to look for my entry model, which is my low time frame alignment. So the fair value gap, let me mark this out, is your high time frame, I'm gonna say delivery, okay, or alignment, okay? So you need to be using fair value gaps in your trading. The reason that we use fair value gaps is because they are objective, right? There's only one way to draw a fair value gap on your chart. It's the gap between the first and the third candle that leaves behind this gap here, right? With order blocks, support and resistance, all these other concepts, they are very subjective. There are multiple ways to draw them. So hopefully if you're still watching this video, that that makes sense to you. Okay, boom, so we have our fair value gaps drawn out. That is all that we are doing. Sometimes I will look to take trades off of five-minute fair value gaps, right? If we were to inverse this four-hour, meaning get a candle closure above, and we formed a new five-minute, maybe I'll look for a continuation long. But these timeframes are the timeframes that I use. So we are going to mark this out, okay? We have a one-hour fair value gap here. Again, if you guys are struggling to find these levels, our indicator will automatically populate these levels for you, which is super, super clutch. So this is what I'm looking at heading into the market. So I am not forcing a trade when we're in the middle of these fair value gaps, okay? So we let market open. We have that initial move to the upside. Guys, what do I always say, especially trading New York session? Most of the time, the first move is the fake-out or the manipulation move, right? So just because the first few minutes of market open are bullish do not mean that we look for longs. Why? Well, remember, we are still inside of this bearish four-hour fair value gap. This is where we would look for short positions, which is where we will use our entry model, which I'll get into in just a few moments, which is going to be an inverse fair value gap, which obviously we did not get here. So all I'm doing, guys, is I'm waiting. Trading is 90% waiting, doing absolutely nothing, and it's 10% actually entering a trade. So keep that in mind when you are day trading. You are getting paid to wait. You are not getting paid to enter trades all the time. In fact, there are periods of time where I will not take a trade for multiple days in a row. So all we're doing is letting price play out. We are also delivering from a 15-minute bearish fair value gap here as well. So this is a four-hour, and it is a 15-minute fair value gap. Now, at this point in time, we get our first entry. We swept this external high here, which is a previous session high. So I'm going to remove this bearish fair value gap because we already know where this is. Now, this is where I will look for my entry model, which is going to be an inverse fair value gap. So I can see we are sweeping this external high inside of a bearish fair value gap, and on a lower time frame, on a one-minute time frame, you can see right here that we have formed a one-minute bullish fair value gap. This is my condition for an entry. So this is going to be my lower time frame alignment. So we are delivering from four-hour slash 15-minute bearish fair value gap. Actually, I'm going to call this our high time frame alignment, and our lower time frame alignment would be a bearish IFVG for entry on one to three-minute time frame. Now, if we get a bearish IFVG, we would have high time frame and low time frame alignment because both of these are bearish. If one of these is bullish, we do not want to take the trade. We want both of these to be bearish if we're looking for shorts. Okay, so we let price play out, and boom, we get a candle closure below right here. Now, when you are entering via an IFVG, you always want to take the highest time frame fair value gap in that leg. We have a one-minute bullish fair value gap as we were sweeping this high. But if we go to a two-minute time frame, we can see that we had a two-minute inverse. Okay, let's check the five-minute, no five-minute. So we also had a three-minute inverse right here. So this is the time frame you'd actually want to enter the trade on. So there we go. There is the three-minute closure below. So this is going to be our entry. We're gonna put our stop loss at this body high. We do not want to see that big of a pullback. Now, because we're taking this as price is sweeping this external high, this is our stop loss, and we are going to be targeting the untapped fair value gaps lower. So not only do we use the higher time frame fair value gap as our delivery when we're getting into the trade, we also use these fair value gaps as take profit levels or magnets for price to go to. Because these fair value gaps have internal liquidity, we can expect price to gravitate towards these levels to take some of these open and resting orders. So this is the first trade that you could have taken. I did not personally take this one because I was bullish on the day, because we are so close to all-time high, but this was a valid trade. And in real time, I said this was a valid short. And if you let this play out, you can see that this would have been either a breakeven trade or at least a TP1. And then eventually you got that reversal. Let us go to our second trade of the day. So what do we do after we sweep this external high? Well, we retrace all the way back down to this bullish one-hour fair value gap and this bullish 15-minute fair value gap. These were the levels that I was looking for price to tap into before looking for a long position. So at this point, I'm going down to a lower time frame and I am looking for a long position. So on a one-minute time frame here, I do not see any sort of bearish fair value gap for price to inverse to go long, okay? There's no fair value gap on the one minute. There's no fair value gap on the two minute. There's only a fair value gap on the three minute, and let's go to the five minute, and also a fair value gap on the five-minute time frame. So this was my condition for a long position. I said, if price closes back above this bearish five-minute fair value gap, I would enter a long position targeting this high right here, which was a data high, okay? Whenever news comes out, it creates this weird looking wick, which we would call a data high, which is a strong draw on liquidity. Price often goes back and tags this level, usually within the same trading day with like an 85% accuracy. So whenever news comes out during the trading session, always mark out those candle highs and lows. These are gonna be really good targets, okay? So I'm waiting for a five-minute candle closure above this bearish fair value gap to go long. What's the reasoning for that? Well, first of all, we are delivering from a one-hour and a 15-minute bullish fair value gap, okay? That is our higher time frame delivery. Now, something else that is really good here, if we draw our golden pocket Fib from the swing low to the swing high, which is the 0.618 and the 0.65 Fibonacci retracement levels, something called the optimal trade entry, we are also delivering or reacting from these levels. So this is also gonna be another form of higher time frame delivery. I'm gonna call this the golden pocket Fib. You guys do not need to use Fibs. This is a little bit more advanced, and this is something I've been using personally for years on this channel. So don't worry about that now, but there was some more confluence there as well. And low time frame, okay? Low time frame, I'm waiting for a five-minute inverse for entry, okay? Both of these bullish, which would be that high time frame plus low time frame alignment, okay? Now, why am I not entering on a three-minute IFEG? Well, I would enter on a three-minute, but we have the five-minute, which is the highest time frame in the leg. So I'll enter on anywhere from a one-minute to five-minute, depending on the highest time frame in that leg. So in this trade example, I am waiting for the five-minute, okay? So we're gonna let price play out. And this is the beautiful thing about trading inversions. What do you notice here? Well, you can see we rejected from this five-minute bearish for a value gap, and we never got an inverse, meaning we never got price to close above. So we don't enter the trade. If there's no trade entry, if there's no low time frame entry with that higher time frame for a value gap, we do not enter the trade. We saved ourself a loss there using the strategy waiting for that inversion. And now you can see that we have also manipulated this low once again, now tagging into our lower 15-minute fair value gap. And keep in mind, we are still inside of a one-hour bullish for a value gap. We have not inversed this just yet. So we are still bullish until price closes below that one-hour bullish for a value gap. We would call that our condition, right? So on a higher time frame, if we were to inverse this bullish for a value gap, meaning a candle closure below, then my bullish thesis is completely invalidated and we are most likely going to go lower for the day. That is where I will be looking for short positions down to this draw on liquidity. But until that happens, right, which would be the 11 a.m. candle closure, we are still technically bullish testing this one-hour fair value gap. So I'm going to remove this first fair value gap here. We also have an internal liquidity sweep here. So this is going to be your manipulation leg, right? Accumulation, manipulation, and now anticipating that distribution back to the upside. Okay, so we perfectly tagged that 15-minute fair value gap. We have taken out all of these lows and you can see that we have formed a one-minute bearish fair value gap here, okay? So this is my condition for an entry. If price closes back above this inverse, I will go long with my stop-loss somewhere below this low and I'm going to be targeting this data high as my draw on liquidity. All right, so we're going to let the next candle play out. Boom, there is our inversion. So this is where we would enter the trade, stop-loss at this candle low, right from that 15 minutes, still inside of that one hour. This was an absolute beauty trade. And guys, we had such a good week in the Discord that I moved my stop-loss to breakeven very quickly on this trade, okay? As soon as we swept this high again, I moved my stop-loss to breakeven. It retested this fair value gap and I got stopped at breakeven on this trade, unfortunately, okay, because this was an absolute banger trade. However, if we go to a higher timeframe, we actually had this bearish five-minute fair value gap right here, okay? So this was my condition for my re-entry, okay? This is where I re-entered the trade, ended up passing some evals on this trade. So a little bit of a later entry, but this is a more confident entry because you're waiting for the first presented in that leg down. So this was my next entry. I was just targeting this data high a little over a one-to-one load in the indicator. The indicator also called this trade as well, gave us that continuation long signal. This was an absolute banger trade right here. We let price play out and instant TP, and this one actually went all the way up to all-time highs if you want to hold a partial there as well. Boom, there's your all-time high hit. So again, we had that higher timeframe delivery and then lower timeframe, we had anywhere from a one-to-five-minute inverse. The one-minute is going to give you that massive risk to reward, but it's gonna be a little bit higher risk. So just keep that in mind when you're trading these reversals. You know, a one-minute is gonna be the most risky if you have a five-minute above, and the five-minute is going to be the most confident trade, which is the one that I entered on. But guys, that's gonna be it for this video. A ton of sauce in this one. If you guys have enjoyed, make sure to leave a like. Comment down below if you guys found value. No one is dropping this amount of sauce on the regular on YouTube for free. If you guys want to trade live with me every single morning, get access to my custom-coded indicators, and really just join a community of like-minded individuals. You know, we all have the same goals. We all wake up ready to attack the markets. We all keep each other accountable. Just a really good community to have if you're serious about taking your trading to the next level. Then click the first link in the description below. But guys, that's gonna do it for me. Subscribe to the channel for more trading content, and I'll see you guys next video.