YouTube Transcript:
Boot Camp Day 12: Liquidity Pt 3

what's good guys welcome to boot camp
who knows what day but all I know is we
are talking about wrapping up our
liquidity
um little lesson little series within
this boot camp so after what we have
learned
um also guys look
pretty little microphone I'm I'm see I'm
spending money on you guys I don't I
didn't need this I was fine with my
trash ass set up but guess what I was
getting [ __ ] on when all you guys were
saying your face cam is ass
um your your setup is ass dude come on
bro I I used to just trade on my phone
you guys are trying to make me up my
[ __ ]
um but anyways today is part three of
our liquidity series and then we will
move from there over to our fair value
Gap series and then over to our order
Block series and then over to our
equilibrium Series so we're we're
starting to add the building blocks that
we need to actually play straights and
that's going to be part of uh what we're
doing today pretty much just talking
about
um you know the full overview of
liquidity seeing how
um
how we can like use it to our advantage
really because now right after the first
day we understand what it is and why we
want to use it right after the second
day
we we can see directly how it works on
the charts right we can see okay a high
gets taken out and then what happens
right you can see orders get filled
through break of structure through
Market structure shift whatever you want
to say and then price changes Direction
so that's more of what we're going to be
doing today literally just spotting it
out on the chart helping you guys be
able to spot it easier
um and then translate that into how you
could potentially take a trade off of it
again I don't want you guys to think
this is a strategy it's not it's a piece
that we can plug in to a strategy okay
this is not end-all be-all okay so I
mean literally just starting off I don't
know if you guys can see this
but pretty [ __ ] obvious we see boom
leg down break of structure up
closing all the way up here price
rallies okay
it's again it's very very easy to see
this on the chart it's when in action
you know can you actually see it and can
you react and actually take the trade
correctly off of it
um and that's what we're going to be you
know trying to help you guys do uh let's
get rid of my trade from this morning
shmink
get rid of this trade that I didn't take
get rid of
anything on here cool
all right so
oops what the [ __ ] all right so to start
off we will cover liquidity on the S P
500 just because it's pretty easy to
spot on high time frames and it's it's
really relatively easy to to show how
you could potentially take a trade off
of this and how it works okay so
first of all right why do we want to use
liquidity right just a little recap
because that is where the market makers
are able to fill their orders right
because there's a bunch of people
exiting the market and there's a bunch
of people entering the market okay
perfect there's a lot of money getting
transacted through the market versus
when liquidity isn't getting swept or
getting you know induced then you know
it's kind of chippy choppy okay Tinky
tacky okay they aren't able to
completely you know change direction of
the market all right so
um
what we're looking for right is highs
and lows within the market right because
that's where people are going to be
entering long
um and that's where people are going to
be entering short and then that's also
where people are going to be getting
stopped out
right so with that being said right we
are technically looking to label highs
and lows as liquidity right in most
importantly prominent highs and lows
okay so you're probably saying well how
do we know what's prominent well it
varies from time frame to time frame on
what is prominent or not but if you just
look
at the chart okay it's it's relatively
easy to to just Mark out what Highs are
prominent
and what lows are prominent
this is getting kind of messy I'm just
going to work with what we put on right
now so as we can see prominent high
right here why because it's the start of
this big Trend okay we come down we come
up and make a like double top pretty
prominent High we come down make a lower
low
okay then we come up and take out this
prominent High making a new prominent
eye and then what does Market do rally
even lower okay boom we can get rid of
these lows okay then what does price
price do we make a relatively prominent
low right here and then a relatively
prominent high right here you could can
argue that these are prominent Highs but
you know
whatever
um relative prominent high right here
relative prominent low right here
obviously we push lower because this is
a downtrend okay what is Zoo price Zoo
come up takes out this high right what
happens brake structure to the downside
price Falls now we have this as a
prominent High
and this as a prominent low okay price
comes down makes a lower low okay I
would also consider this a prominent
High because it broke structure on The
Daily time frame
um okay what happens price rallies up
takes out the prominent High comes down
a little bit okay now we've pushed past
that where is Price likely going to draw
towards
this high right we can think of
liquidity essentially as a magnet for
price that is where price is drawing to
because that is where the market makers
want to push price so they can get their
orders filled make sense cool right so
any form of liquidity right consider it
a magnet for price right we're not
considering it oh buy oh sell we're
saying okay this is an area where orders
could get filled
for us to potentially take a trade it
doesn't mean when this High gets hit we
press sell it doesn't mean when these
lows get hit and press by right because
if you did that you would lose way more
than you win right we wait for these
areas of liquidity to get hit and then
we wait for confirmation
through breaker structure through other
confluences right that we'll talk about
later in this okay we wait for those
confluences to give us the confirmation
that liquidity has been swept and that
orders have been filled
that makes sense right so when we see a
liquidity sweep when we see these
prominent highs and lows get taken out
it's safe to assume
okay I'm now going to wait for
confirmation that orders have been
filled because then price is going to go
in the opposite direction
that makes sense
cool okay and that's all liquidity is so
how can we use this our to our advantage
for entries well I just talked about it
right we we wait for those those prices
to get hit and then we see what price
reacts off of it price doesn't react
perfect no trade
if price does react perfect act on it
take a trade right and then on the
contrary how can we use liquidity for
take profits right if if it's a magnet
for Price above right if we if we think
okay yeah highs will attract will
attract price because that's what it
wants to seek out in order to go lower
if we're saying oh yeah this is a this
is a relative bear market right now
right if we're saying oh yeah this is a
relatively bear Market
laughs
I think price will go lower
right then we're waiting for highs to
get taken out but then right when let's
say we do find a trade let's say we're
able to find an entry whatever here
where are we where are we going to
Target right if we think price is going
to look go lower if liquidity is a
magnet
then it's probably going to start
seeking out these lows why because just
like how market makers need you guys to
be entering and exiting for them to
enter orders it's the same thing with
exiting right because if they exit if
they exit at a random point at in the
chart right without a low or a high
being like an area where they where they
take orders out
right if they were to just you know exit
right now right price would probably
drop price will move in the other
direction they still need people
entering and exiting the market just
like they do to fill their orders to
keep to to sell their orders right to
exit their orders to exit their position
right without price just making a big
move after those positions get closed
out does that make sense because same
thing with them wanting to go go short
at the highs they also want to you know
close and right if they're if they're
close
um if they're going short they're going
to be closing their position at Lowe's
why because there's going to be people
going short there's also people going to
be exiting wow
been here for too long already sorry I'm
sorry
um for the language shift
um I was just talking to this lady on
the phone in Spanish so my Spanish is
not nearly as good as what it used to be
but it gets me around here
um so
does that make sense right so if we're
looking if we're looking for shorts
we're using liquidity to be this the
peak of our interest right we take out a
high we get a breaker structure to the
downside perfect and then like any other
Confluence perfect we can go short
okay and then where are we targeting the
lows right because that's where they can
exit their position
just like how they were able to fill
their position at the high they have to
exit their position at the lows
make sense
cool cool
okay so let's just go through more
examples of this
just working
and we can even go over the
examples right here that we already
marked out right so we had a prominent
high right here as we can see price
pushes up where do we get the break of
structure if you guys remember that
portion
boom we get a break of structure right
here this was the most recent low we got
a closure below perfect you can either
enter off that
enter off of you know some sort of
off of some some sort of fair value gap
on the four hour Within These candles
right we see that get filled chop chop
chop break down okay whatever whatever
you want right we get a liquidity sweep
then a break of structure those are
pretty standard okay then where do we
target
next previous prominent lows
price draws to it just like a [ __ ]
magnet moving forward
okay where where is our next previous
prominent lows that get made prior to
the braking structure to the upside on
The Daily right here where's that
where's the prominent eye that gets made
on The Daily right here okay we see
price move up past it got one pretty far
past it but then we get a breaker
structure after another form of
liquidity gets swept right we have highs
right here highs right here right we
push past this one don't give up much of
a reaction we push pass take out this
one we do get a reaction break of
structure to the downside you know
whether you find uh an imbalance within
here this daily candle filled this fair
value Gap within here whatever you want
okay it filled orders okay we see the
confirmation of it with the break of
structure
where does price go to
where does it get magnetized to previous
prominent low now we have previous
prominent lows right here
prominent highs all the way up here
and some other prominent highs in
between but we've already pushed past
them right we can see that right we had
this prominent High gets taken out we
failed to reach this low we're just
chopping up
um and now we're pushing for this High
okay so you could argue that this is a
prominent low
and this is a prominent low and none of
these highs have caused a reaction yet
so now this is the one that we're
looking for
cool does that make sense perfect let's
show it now let's show this happening on
a smaller time frame
not just the daily because this happens
on literally every single time frame
and it can be used to your advantage
just like this
okay we're looking at the four hour on
GBP USD what's the first thing you see
big rally up and then a big dump
I wonder why that happened okay we have
boom highs right here okay you're
probably saying it never got hit exactly
look on the one hour
sweep
when's our break boom with this candle
right here wait for some type of
retracement on up
right we get a break of structure with
this candle boom push back up hits this
order block
capitulates
taking out prominent low filling this
imbalance filling this imbalance so many
areas for you to take profit here but
we're just talking about liquidity right
now there will be a whole section on how
to take profits later
okay does that make sense same thing
here right
boom we have highs right here barely
gets Wicked
price okay where's our break of
structure we get a break right here
right we get a we have a low right here
down candle up candle this is our low
most recent low that's you know applied
to a break of structure as you can see
none of these lows got broken this low
gets broken you can scale into the five
minute boom imbalance gets filled right
within here find some sort of
confirmation boom go short where
there's lows right here
there's a full freaking imbalance within
here all of that right all that good
stuff and and we'll get into that later
I'm literally just trying to show you
guys how liquidity works and how you can
use the draw on liquidity for taking
profits and then also
for entering positions same thing with
gold right here
Lowe's boom
we see boom price drives in boom quick
regain up closure above right here yes
we get some dip down into this imbalance
this is probably where you would have
wanted to get your orders filled
okay find some sort of Entry within here
and we'll go over that where does price
draw back up to Boom previous highs once
it once those previous highs get hit
boom orders liquidated orders filled now
we're chopping
simple simple boys very very simple
um and it's and it gets a lot easier
when when you start being able to just
like spot this like at the back of your
hand like you you should be able to pull
up a chart and just be like oh that's a
liquidity sleep yep that's a liquidity
sweep liquidity sweep liquidity sweep
right you should be able to see these
like like none other
sweep rally
what's this right here oh sweep rally
you know
oh what's this right here sweep drop
sweep retracement
you know it's it's really funny how easy
how easy it is and how comfortable you
get starting to see this but it's one
thing you know being able to see it
oh sweet fall
what's this
oh sweep rally you can't tell me that
this [ __ ] doesn't work
right you really can't you you cannot
tell me that this [ __ ] does not work and
it happens on every single time frame
right sweep rally
like I see this [ __ ] happen on on the 15
minute
I see this [ __ ] happen on the one minute
oh damn that's crazy there's a low sweep
rally
oh damn that's crazy these highs sweep
drop
it it's how these markets move it's how
orders get get filled it's how markets
literally flow
damn that's a cool low sweep rally
I'll take that low I'll fill my orders
you know
that's all this is
Okay so
again that was just me trying to show
you guys like examples of all this going
down
um and hopefully you guys have a better
idea of liquidity
again now homework isn't just seeing the
liquidity sweep it's not saying there it
is and just marking it on several
different time frames and now I want you
to try and pair it with something
try and find
five liquidity sweeps on whatever pair
you use I don't care what time frame
find five liquidity sweeps okay
and then see how you could have you know
gained more confidence for a trade
you see the sweep
and then look into the price action that
follows okay there was a break of
structure that's a Confluence for me to
trade okay and then after the break of
structure it filled an imbalance and
reacted off of it that's where I'm
entering okay we got a sweep of
liquidity a break of structure a hidden
order block reacted boom that's where
I'm entering
simple as that that [ __ ] easy it's
not [ __ ] easy okay and that's really
what our strategy is going to get into
but you guys don't necessarily
completely understand some of the some
of the logistical things
um that we're going to cover but that's
it for now okay that is liquidity
explained hopefully you guys have a good
grasp on this if you don't re-watch the
three videos that we've made on it and
then also go back and re-watch my how to
spot liquidity sweeps just like very
first you know video that I put
um that I put up like one of my first
videos on YouTube okay so if you're
having trouble with this it's okay
there's a reason why I split this up
into three parts okay understand why we
want to use it and understand where it
lies within the market and then
understand that liquidity
it's fine to Mark out every single high
and low but not every single high and
low will be used as liquidity to fill
orders and that's why we wait for a
Confluence that's why we wait for
breaker structure that's why we wait for
a fair value Gap then a reaction that's
why we wait for an order block then a
reaction that's why we wait for all that
stuff
does that make sense cool you guys know
your homework Find find five examples of
a liquidity sweep trade setup or a
liquidity suite and Confluence for why
it went in the direction it did
get that done take some notes and then
let's get after it all right I'll see
you boys tomorrow for some and
discipline